Table of Contents

Homeland Security Games: The Value of Flexible Redeployment

Sarah Yini Gao, Singapore Management University - Lee Kong Chian School of Business, National University of Singapore (NUS) - Department of Decision Sciences
Chung-Piaw Teo, NUS Business School - Department of Decision Sciences
Huan Zheng, Shanghai Jiao Tong University (SJTU) - Antai College of Economics and Management

Allocation Inequality in Cost Sharing Problem

Zhi Chen, National University of Singapore (NUS) - Department of Analytics & Operations
Zhenyu Hu, National University of Singapore (NUS) - Department of Decision Sciences
Qinshen Tang, National University of Singapore (NUS) - Department of Analytics & Operations

Spillovers, Persistence and Learning: Institutions and the Dynamics of Cooperation

Roberto Galbiati, Sciences Po
Emeric Henry, Sciences Po - Department of Economics
Nicolas Jacquemet, Paris School of Economics (PSE), Université Paris I Panthéon-Sorbonne

Who Loses When Prices are Negotiated? An Analysis of the New Car Market

Ambarish Chandra, University of Toronto - Rotman School of Management
Sumeet Gulati, University of British Columbia - Food and Resource Economics
James M. Sallee, University of California, Berkeley - Department of Agricultural & Resource Economics

The Value of Delegated Quality Control

Alexander E. Saak, CGIAR - Markets, Trade, and Institutions Division, Kansas State University - Department of Agricultural Economics

The Chimera of Sustainable Labour–Management Partnership

Tony Dobbins, Bangor Business School
Tony Dundon, National University of Ireland


GAME THEORY & BARGAINING THEORY eJOURNAL

"Homeland Security Games: The Value of Flexible Redeployment" Free Download

SARAH YINI GAO, Singapore Management University - Lee Kong Chian School of Business, National University of Singapore (NUS) - Department of Decision Sciences
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CHUNG-PIAW TEO, NUS Business School - Department of Decision Sciences
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HUAN ZHENG, Shanghai Jiao Tong University (SJTU) - Antai College of Economics and Management
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The classical Colonel Blotto game is one of the earliest games to model conflicts in multiple battle- fields. In this paper, we extend the Colonel Blotto game to model homeland security game between a defender and an attacker where the defender can redeploy its resources after observing the attacker’s deployment. This asymmetry reflects the locational advantage of the defender who has more time to prepare the battlegrounds. Our goal is to understand the value of this redeployment option in such games, and understand its impact on the attacker’s and defender’s strategy.

In general, finding an equilibrium strategy in this game is challenging. We show the redeployment problem with classic auction contest success function is, in general, NP hard. For a simplified contest success function, when the redeployment structure has a nice form, such as “k-chain? structure, we obtain closed-form equilibria to these problems. For the game under a general redeployment network structure, we obtain an equivalent reformulation of the game using a conic program. This extends recent LP based approach to characterize the equilibrium strategies in the classical Blotto game.

By analyzing this equivalent conic reformulation, we obtained many interesting properties of the game, i.e. value of the game, defender’s strategy, and the marginal moments of attacker’s mixed strategy, directly from the conic program. We further explored how the redeployment network structure affects the game, showing that a sparse redeployment network structure can already capture the value of redeployment for the defender.

"Allocation Inequality in Cost Sharing Problem" Free Download

ZHI CHEN, National University of Singapore (NUS) - Department of Analytics & Operations
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ZHENYU HU, National University of Singapore (NUS) - Department of Decision Sciences
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QINSHEN TANG, National University of Singapore (NUS) - Department of Analytics & Operations
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This paper considers the problem of cost sharing, in which a coalition of agents, each endowed with an input, shares the output cost incurred from the total inputs of the coalition. Two allocations --- average cost pricing and the Shapley value --- are arguably the two most widely studied solution concepts to this problem. It is well known in the literature that the two allocations can be respectively characterized by different sets of axioms and they share many properties that are deemed reasonable. We seek to bridge the two allocations from a different angle --- allocation inequality. We use the partial order: Lorenz order (or majorization) to characterize allocation inequality and we derive simple conditions under which one allocation Lorenz dominates (or is majorized by) the other. Examples are given to show that the two allocations are not always comparable by Lorenz order. Our proof, built on establishing Lorenz order over certain input vectors, maybe of independent interest.

"Spillovers, Persistence and Learning: Institutions and the Dynamics of Cooperation" Fee Download
CEPR Discussion Paper No. DP12128

ROBERTO GALBIATI, Sciences Po
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EMERIC HENRY, Sciences Po - Department of Economics
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NICOLAS JACQUEMET, Paris School of Economics (PSE), Université Paris I Panthéon-Sorbonne
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We study how cooperation-enforcing institutions dynamically affect values and behavior using a lab experiment designed to create individual specific histories of past institutional exposure. We show that the effect of past institutions is mostly due to "indirect" behavioral spillovers: facing penalties in the past increases partners' cooperation in the past, which in turn positively affects ones' own current behavior. We demonstrate that such indirect spillovers induce persistent effects of institutions. However, for interactions that occur early on, we find a negative effect of past enforcement due to differential learning under different enforcement institutions.

"Who Loses When Prices are Negotiated? An Analysis of the New Car Market" Fee Download
The Journal of Industrial Economics, Vol. 65, Issue 2, pp. 235-274, 2017

AMBARISH CHANDRA, University of Toronto - Rotman School of Management
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SUMEET GULATI, University of British Columbia - Food and Resource Economics
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JAMES M. SALLEE, University of California, Berkeley - Department of Agricultural & Resource Economics
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We establish that there are large and persistent differences in final transaction prices for identical new cars, and that demographic characteristics explain at least 20% of the observed variation. Older consumers perform progressively worse in negotiations, and the age premium is greater for women than for men. Our results suggest that the complex nature of vehicle transactions leads to price dispersion in this market, and that the worst performing groups—older women—have the lowest rates of market participation. We conjecture that the results are driven by the sharp increases in women's education and labor force participation in recent decades.

"The Value of Delegated Quality Control" Fee Download
The Journal of Industrial Economics, Vol. 65, Issue 2, pp. 309-335, 2017

ALEXANDER E. SAAK, CGIAR - Markets, Trade, and Institutions Division, Kansas State University - Department of Agricultural Economics
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This paper studies the case in which a firm delegates quality control to an independent monitor. In a repeated game, consumers’ trust provides incentives to acquire information about whether the good is defective, and withhold defective goods from sale. If third‐party reports are observable to consumers, delegation lessens the first and dispenses with the second moral hazard concern but also creates agency costs. Internal quality control is optimal only if trades are sufficiently frequent and consumer information is sufficiently precise. This result holds in the presence of the possibility of collusion, fully non‐verifiable presale information, and economies of scale in external quality control.

"The Chimera of Sustainable Labour–Management Partnership" Fee Download
British Journal of Management, Vol. 28, Issue 3, pp. 519-533, 2017

TONY DOBBINS, Bangor Business School
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TONY DUNDON, National University of Ireland
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The paper advances a threefold theoretical contribution using a system, society and dominance (SSD) effects framework to show how and why sustainable management–labour workplace partnerships are a chimera. First, managers (employers) find it increasingly difficult to keep workplace bargains with employees (unions) owing to increasingly neoliberal ‘system’ effects associated with capitalism as a globalized accumulation model. Second, workplace mutuality will be rare because of ‘societal’ level effects under voluntarism. Third, ‘dominance’ effects arising from the power of dominant economies and their multinational corporations can inhibit workplace mutuality. Drawing on empirical case study data from Ireland, the future prognosis of management–labour collaboration under neoliberal work regimes is discussed.

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