Common Mistakes in Computing the Nucleolus

15 Pages Posted: 17 Apr 2014

See all articles by Mario Guajardo

Mario Guajardo

Norwegian School of Economics (NHH) - Department of Business and Management Science

Kurt Jornsten

Norwegian School of Economics (NHH) - Department of Business and Management Science

Date Written: April 14, 2014

Abstract

Despite linear programming and duality have correctly been incorporated in algorithms to compute the nucleolus, we have found mistakes in how these have been used in a broad range of applications. Overlooking the fact that a linear program can have multiple optimal solutions and neglecting the relevance of duality appear to be crucial sources of mistakes in computing the nucleolus. We discuss these issues and illustrate them in mistaken examples collected from a variety of literature sources. The purpose of this note is to prevent these mistakes propagate longer by clarifying how linear programming and duality can be correctly used for computing the nucleolus.

Keywords: Game theory, Nucleolus, Cost allocation, Linear programming, Duality

JEL Classification: C60, C61, C70

Suggested Citation

Guajardo, Mario and Jornsten, Kurt, Common Mistakes in Computing the Nucleolus (April 14, 2014). NHH Dept. of Business and Management Science Discussion Paper No. 2014/15, Available at SSRN: https://ssrn.com/abstract=2425596 or http://dx.doi.org/10.2139/ssrn.2425596

Mario Guajardo (Contact Author)

Norwegian School of Economics (NHH) - Department of Business and Management Science ( email )

Helleveien 30
Bergen, NO-5045
Norway

Kurt Jornsten

Norwegian School of Economics (NHH) - Department of Business and Management Science ( email )

Helleveien 30
Bergen, NO-5045
Norway

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