Stable Coalition Structures in Simple Games with Veto Control

Abstract

In this paper we study hedonic coalition formation games in which players' preferences over coalitions are induced by a semi-value of a monotonic simple game with veto control. We consider partitions of the player set in which the winning coalition contains the union of all minimal winning coalitions, and show that each of these partitions belongs to the strict core of the hedonic game. Exactly such coalition structures constitute the strict core when the simple game is symmetric. Provided that the veto player set is not a winning coalition in a symmetric simple game, then the partition containing the grand coalition is the unique strictly core stable coalition structure.

Keywords: Banzhaf value, hedonic game, semi-value, Shapley value, simple game, strict core

JEL Classification: D72, C71