IDEAS home Printed from https://ideas.repec.org/p/duk/dukeec/95-19.html
   My bibliography  Save this paper

Cost-Sharing under Increasing Returns: A Comparisonof Simple Mechanisms

Author

Listed:
  • Moulin, Herve

Abstract

A technology with descreasing marginal costs is used by agents with equal rights. Each agent demands a quantity of output and costs are divided by means of a fixed formula. Several such mechanisms are compared for the existence of Nash equilibrium demand profiles and for the equity properties of these equilibria. Among three mechanisms, average cost pricing, the Shapley-Shubnik cost sharing and serial cost-sharing, only the latter two possess at least one Nash equilibrium at a reasonable domain of individual preferences. Only the serial cost sharing equilibria pass the equity tests of No Envy and Stand Alone cost.

Suggested Citation

  • Moulin, Herve, 1995. "Cost-Sharing under Increasing Returns: A Comparisonof Simple Mechanisms," Working Papers 95-19, Duke University, Department of Economics.
    • Handle: RePEc:duk:dukeec:95-19
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cyril Téjédo & Michel Truchon, 2002. "Monotonicity and Bounds for Cost Shares under the Path Serial Rule," CIRANO Working Papers 2002s-43, CIRANO.
    2. Jop Schouten & Mirjam GrooteSchaarsberg & Peter Borm, 2024. "Cost sharing methods for capacity restricted cooperative purchasing situations," Review of Economic Design, Springer;Society for Economic Design, vol. 28(2), pages 347-390, June.
    3. Koster, Maurice & Tijs, Stef & Borm, Peter, 1998. "Serial cost sharing methods for multi-commodity situations," Mathematical Social Sciences, Elsevier, vol. 36(3), pages 229-242, December.
    4. Tejedo, Cyril & Truchon, Michel, 2002. "Serial cost sharing in multidimensional contexts," Mathematical Social Sciences, Elsevier, vol. 44(3), pages 277-299, December.
    5. Roma Paolo & Perrone Giovanni, 2010. "Generic Advertising, Brand Advertising and Price Competition: An Analysis of Free-Riding Effects and Coordination Mechanisms," Review of Marketing Science, De Gruyter, vol. 8(1), pages 1-29, October.
    6. Angeles de Frutos, M., 1998. "Decreasing Serial Cost Sharing under Economies of Scale," Journal of Economic Theory, Elsevier, vol. 79(2), pages 245-275, April.
    7. Cyril Téjédo & Michel Truchon, 2001. "Serial Cost Sharing in Multidimensional Contexts (May 2002 revised version)," CIRANO Working Papers 2001s-68, CIRANO.
    8. Moulin, Herve, 1995. "On Additive Methods to Share Joint Costs," Mathematical Social Sciences, Elsevier, vol. 30(1), pages 98-99, August.
    9. Yizhaq Minchuk & Aner Sela, 2020. "Contests with insurance," Review of Economic Design, Springer;Society for Economic Design, vol. 24(1), pages 1-22, June.
    10. Chen, Zhi & Hu, Zhenyu & Tang, Qinshen, 2020. "Allocation inequality in cost sharing problem," Journal of Mathematical Economics, Elsevier, vol. 91(C), pages 111-120.
    11. Tommy Andersson, 2007. "Non‐Linear Pricing As A Cooperative Game," Metroeconomica, Wiley Blackwell, vol. 58(4), pages 503-513, November.
    12. Maurice Koster, 2006. "Heterogeneous cost sharing, the directional serial rule," Mathematical Methods of Operations Research, Springer;Gesellschaft für Operations Research (GOR);Nederlands Genootschap voor Besliskunde (NGB), vol. 64(3), pages 429-444, December.
    13. Hougaard, Jens Leth & Thorlund-Petersen, Lars, 2001. "Mixed serial cost sharing," Mathematical Social Sciences, Elsevier, vol. 41(1), pages 51-68, January.
    14. Federico Quartieri, 2013. "Coalition-proofness under weak and strong Pareto dominance," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 40(2), pages 553-579, February.
    15. Qiaohai (Joice) Hu & Leroy B. Schwarz & Nelson A. Uhan, 2012. "The Impact of Group Purchasing Organizations on Healthcare-Product Supply Chains," Manufacturing & Service Operations Management, INFORMS, vol. 14(1), pages 7-23, January.
    16. Watts, Alison, 2002. "Uniqueness of equilibrium in cost sharing games," Journal of Mathematical Economics, Elsevier, vol. 37(1), pages 47-70, February.
    17. Minchuk, Yizhaq, 2018. "Effect of reimbursement on all-pay auction," Economics Letters, Elsevier, vol. 172(C), pages 28-30.
    18. Flam, S. D. & Jourani, A., 2003. "Strategic behavior and partial cost sharing," Games and Economic Behavior, Elsevier, vol. 43(1), pages 44-56, April.
    19. Koster, M.A.L., 1998. "Multi-Service Serial Cost Sharing : A Characterization of the Moulin-Shenker Rule," Discussion Paper 1998-06, Tilburg University, Center for Economic Research.
    20. Koster, M., 2005. "Cost Sharing, Differential Games, and the Moulin-Shenker Rule," CeNDEF Working Papers 05-07, Universiteit van Amsterdam, Center for Nonlinear Dynamics in Economics and Finance.
    21. Koster, M.A.L., 1998. "Multi-Service Serial Cost Sharing : A Characterization of the Moulin-Shenker Rule," Other publications TiSEM 4d029e40-e4e7-4f90-b963-d, Tilburg University, School of Economics and Management.
    22. Pham, Ngoc Anh, 2019. "Lorenz comparison between Increasing serial and Shapley value cost-sharing rules," Economics Letters, Elsevier, vol. 179(C), pages 49-52.

    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:duk:dukeec:95-19. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Department of Economics Webmaster (email available below). General contact details of provider: http://econ.duke.edu/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.