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To model inter-individual externalities and analyze the associated compensation issue, Ju and Borm (2005) introduces a new game-theoretic framework, primeval games, and proposes, from a cooperative perspective, three compensation rules as solution concepts for primeval games: the marginalistic...
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The classical literature (Pigou (1920), Coase (1960), Arrow (1970)) and the relatively recent studies (cf. Varian (1994)) associate the externality problem with efficiency. This paper focuses explicitly on the compensation problem in the context of externalities. To capture the features of...
Persistent link: https://www.econbiz.de/10005636092
-emptiness of the strong core and the second domain restriction ensures non-emptiness of the weak core of the corresponding hedonic … games. Moreover, an element of the strong core under friends appreciation can be found in polynomial time, while finding an … element of the weak core under enemies aversion is NP-hard. We examine also the relationship between our domain restrictions …
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