E. Bahel, M. Gómez Rúa, J. Vidal-Puga
The paper studies shortest path games, which are network games where agents need to ship their demands of some homogeneous good to their respective locations. An optimal network configuration obtains when each agent ships her demand through her shortest path, i.e., the path that minimizes the unitary shipping cost. We define several cost sharing mechanisms that produce core allocations. Some other requirements are natural in this context: in particular, we study merge-proofness. It turns out that he cost sharing rule where each agent pays exactly the cost of her shortest path (per unit demanded) is the unique rule satisfying both core selection and merge-proofness. Using some other axioms, we propose alternative characterizations of this rule. We also study the so-called second-shortest path rule, under which each demander pays the cost of her second-cheapest path, and the payment in excess is equally divided between those who help the demander connect to the source
Keywords: shortest path games, cost sharing, merge-proofness, core selection
Scheduled
GT2-1 MA-1 Game Theory. Tribute to Marco Antonio López
September 5, 2019 10:40 AM
I3L8. Georgina Blanes building