LUCAS COUNTER EXAMPLE REVISITED

Effrosyni Diamantoudi () and Licun Xue ()

Departmental Working Papers from McGill University, Department of Economics

Abstract: We revisit Lucas’(1968) counter example for the existence of von Neumann and Morgenstern (1944) stable set (solution) for coalitional games. We show that when we endow the agents with foresight, particularly, when we replace von Neumann and Morgenstern’s (1944) dominance relation with the indirect dominance relations introduced by Harsanyi (1974), Lucas’s example admits a stable set.

JEL-codes: C71 (search for similar items in EconPapers)
Pages: 9 pages
Date: 2006-09
New Economics Papers: this item is included in nep-dge and nep-gth
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:mcl:mclwop:2005-09

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