The Stable Demand Set General Characterization and Application to Majority Games

Ohio State University Working Paper No. 0103

27 Pages Posted: 8 May 2001

See all articles by Massimo Morelli

Massimo Morelli

Bocconi University

Maria Montero

University of Nottingham - School of Economics

Date Written: March 2001

Abstract

The cooperative solution concept introduced here, the Stable Demand Set, contains the Core and is included in the Zhou Bargaining Set, eliminating the "dominated" coalition structures. The demand vectors belonging to the Stable Demand Set are self-stable. In the class of constant-sum homogeneous weighted majority games the Stable Demand Set is non-empty and predicts a unique stable demand vector, namely a proportional distribution within minimal winning coalitions. The noncooperative implementation of the Stable Demand Set is obtained for all the games that satisfy the one-stage property.

Keywords: Stable Demands, Undominated Coalition Structures, Weighted Major-ity Games, Bargaining Sets

JEL Classification: C7

Suggested Citation

Morelli, Massimo and Montero, Maria, The Stable Demand Set General Characterization and Application to Majority Games (March 2001). Ohio State University Working Paper No. 0103. Available at SSRN: https://ssrn.com/abstract=269269 or http://dx.doi.org/10.2139/ssrn.269269

Massimo Morelli (Contact Author)

Bocconi University ( email )

Via Roentgen 1
Milan, 20136
Italy

Maria Montero

University of Nottingham - School of Economics ( email )

Centre for Decision Research & Experimental Econ.
University Park
Nottingham NG7 2RD
United Kingdom

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