Common Cost Allocation in the Firm
COST ALLOCATION: METHODS, PRINCIPLES AND APPLICATIONS, H. Peyton Young, ed., North-Holland, 1985
24 Pages Posted: 17 Jun 2011 Last revised: 30 Sep 2015
Date Written: 1985
Abstract
Twenty years ago. Martin Shubik suggested that the Shapley value of a game be used to allocate accounting costs. While that suggestion has-spawned a number of cost allocation proposals based on game-theoretic constructs, these studIes comprise only one of several major streams of cost allocation research. This study provides a framework in which the major streams of cost allocation research are evaluated and compared, with a special emphasis on those areas which relate to common cost allocation in the firm. This paper is a condensed version of "Allocations of Joint and Common Costs".
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