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The Core of a Partition Function Game

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  • Laszlo A Koczy

Abstract

We consider partition function games and introduce new definitions of the core that include the effects of externalities. We assume that all players behave rationally and that all stable outcomes arising are consistent with the appropriate generalised concept of the core. The result is a recursive definition of the core where residual subgames are considered as games with fewer players and with a partition function that captures the externalities of the deviating coalition. Some properties of the new concepts are discussed.

Suggested Citation

  • Laszlo A Koczy, 2000. "The Core of a Partition Function Game," Working Papers of Department of Economics, Leuven ces0025, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
  • Handle: RePEc:ete:ceswps:ces0025
    as

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    File URL: https://lirias.kuleuven.be/bitstream/123456789/500647/1/DPS0025.pdfTemplate-type:ReDIF-Paper1.0Handle:RePEc:ete:ceswps:ces0026Author-Name:JozefKoningsAuthor-Name:FilipRoodhooftTitle:LiquidityConstraintandtheDemandforFood:IncomeElasticityofCalorieinRuralEthiopia.Abstract:E-businessoffersbuyersandsellersanewformofcommunicationandprovidesanopportunitytocreatenewmarketplaces.Theoreticalstudiessuggestingeneralthatthedevelopmentofe-businessresultsinhigherfirmperformanceasaresultoflowersearchandhead-to-headcomparisoncosts.However,thereareanumberofrecenttheoreticalstudies,whichdemonstratethatthegrowthofe-commercemayleadtomonopolisticpricingbehavioursothatfirmsengagingine-commerceneednotperformbettercomparedtomoretraditionalenterprises.Todate,thereexistslittleempiricalevidenceontheimpactofinformationtechnologyoneconomicperformance.ThispaperisthefirstthatusesalargerepresentativedatasetofBelgianfirmstostudyempiricallytheimpactofe-businessoncorporateperformance.Ourmainconclusionscanbesummarisedasfollows:(1)ThepenetrationoftheInternetinBelgianfirmsishigh,however,theuseofe-businessisstilllimited.(2)Itisespeciallythelargefirmsthatengageine-businessandmostlyine-procurement.(3)E-businesshasnoeffectontotalfactorproductivityinsmallfirms,however,wefindpositiveeffectsonperformanceofe-businessinlargefirms.
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    References listed on IDEAS

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    1. Parkash Chander & Henry Tulkens, 2006. "The Core of an Economy with Multilateral Environmental Externalities," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 153-175, Springer.
    2. Claude d'Aspremont & Alexis Jacquemin & Jean Jaskold Gabszewicz & John A. Weymark, 1983. "On the Stability of Collusive Price Leadership," Canadian Journal of Economics, Canadian Economics Association, vol. 16(1), pages 17-25, February.
    3. Herbert E. Scarf, 1965. "The Core of an N Person Game," Cowles Foundation Discussion Papers 182R, Cowles Foundation for Research in Economics, Yale University.
    4. Becker, Robert A & Chakrabarti, Subir K, 1995. "The Recursive Core," Econometrica, Econometric Society, vol. 63(2), pages 401-423, March.
    5. Massimo Morelli & Philippe Penelle, 1997. "Economic Integration as a Partition Function Game," Working Papers 9702, Harris School of Public Policy Studies, University of Chicago.
    6. Yukihiko Funaki & Takehiko Yamato, 1999. "The core of an economy with a common pool resource: A partition function form approach," International Journal of Game Theory, Springer;Game Theory Society, vol. 28(2), pages 157-171.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    new economy; internet; firm performance; e-procurement; e-business Classification-JEL: D0; L0; O3; M0 Creation-Date: 2000-03;
    All these keywords.

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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