An efficient and almost budget balanced cost sharing method

B-Tier
Journal: Games and Economic Behavior
Year: 2010
Volume: 70
Issue: 1
Pages: 107-131

Score contribution per author:

2.011 = (α=2.01 / 1 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

For a convex technology C we characterize cost sharing games where the Nash equilibrium demands maximize total surplus. Budget balance is possible if and only if C is polynomial of degree n-1 or less. For general C, the residual* cost shares are balanced if at least one demand is null, a characteristic property. If the cost function is totally monotone, a null demand receives cash and total payments may exceed actual cost. The ratio of excess payment to efficient surplus is at most . For power cost functions, C(a)=ap, p>1, the ratio of budget imbalance to efficient surplus vanishes as . For analytic cost functions, the ratio converges to zero exponentially along a given sequence of users. All asymptotic properties are lost if the cost function is not smooth.

Technical Details

RePEc Handle
repec:eee:gamebe:v:70:y:2010:i:1:p:107-131
Journal Field
Theory
Author Count
1
Added to Database
2026-01-26