van den Brink, Rene van der Laan, Gerard Moes, Nigel
Year of Publication:
Tinbergen Institute Discussion Paper 12-050/1
In this note we provide a strategic implementation of the average tree solution for zero-monotonic cycle-free graph games. That is, we propose a non-cooperative mechanism of which the unique subgame perfect equilibrium payoffs correspond to the average hierarchical outcome of the game. This mechanism takes into account that a player is only able to communicate with other players (i.e., to make proposals about a division of the surplus of cooperation) when they are connected in the graph.
implementation cycle-free graph game tree game hierarchical outcome average tree solution weighted hierarchical outcome