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Competitive outcomes and the inner core of NTU market games

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  • Sonja Brangewitz
  • Jan-Philip Gamp

Abstract

We consider the inner core as a solution concept for cooperative games with non-transferable utility (NTU) and its relationship to payoffs of competitive equilibria of markets that are induced by NTU games. An NTU game is an NTU market game if there exists a market such that the set of utility allocations a coalition can achieve in the market coincides with the set of utility allocations the coalition can achieve in the game. In this paper, we introduce a new construction of a market based on a closed subset of the inner core which satisfies a strict positive separability. We show that the constructed market represents the NTU game and, further, has the given closed set as the set of payoff vectors of competitive equilibria. It turns out that this market is not uniquely determined, and thus, we obtain a class of markets. Our results generalize those relating to competitive outcomes of NTU market games in the literature. Copyright Springer-Verlag Berlin Heidelberg 2014

Suggested Citation

  • Sonja Brangewitz & Jan-Philip Gamp, 2014. "Competitive outcomes and the inner core of NTU market games," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 57(3), pages 529-554, November.
    • Handle: RePEc:spr:joecth:v:57:y:2014:i:3:p:529-554
    DOI: 10.1007/s00199-014-0846-7
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    References listed on IDEAS

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    More about this item

    Keywords

    Market games; NTU games; Competitive payoffs; Inner core; C71; D51;
    All these keywords.

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies

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