International Game Theory Review

A Cephoid is an algebraic ("Minkowski") sum of finitely many prisms in ℝⁿ. A cephoidal game is an NTU game the feasible sets of which are cephoids. We provide a version of the Shapley NTU value for such games based on the bargaining solution of Maschler–Perles. The value is characterized by a suitable set of axioms

A manufacturer and a retailer are the members of a simple distribution channel for a particular product in a segmented market. The advertising efforts of the two agents have a joint effect on the goodwill of the different market segments and then on the demand. The channel members aim at maximizing their profits, by choosing suitable advertising media and efforts. We focus mainly on competition between manufacturer and retailer, obtaining Nash equilibrium strategies, in the contexts of linear and concave demand. We consider also the possibility of cooperation, obtaining the coordinated channel optimal decisions.

Standard models of observational learning in settings of sequential choice have two key features. The first is that players make decisions by using Bayes' rule to update their beliefs about payoffs from a common prior. The second is that each agent's decision rule is common knowledge, so that subsequent players can draw inferences about unobserved private signals from observable actions. In this paper, I relax the first assumption while maintaining the second. In particular, I look at observational learning by players who choose between two actions using nonparametric methods for estimating payoffs. When players are identical and make inferences using the maximum score method, an informational cascade and herd must result. If players of different payoff types use kernel or nearest-neighbor methods, there are cases in which a cascade need not arise. If one does occur, it must be one in which all players, regardless of type, choose the same action. In some situations, these alternative learning rules perform better than Bayesian updating.

This paper considers a large population, game theoretic job-search problem, in which the ratio of job searchers to jobs is α. There are n distinct types of jobs, each with an associated value. Each searcher can only accept one job and cannot recall a job previously rejected. Once a searcher accepts a job, no other searcher can obtain that particular job. The reward to a searcher is taken to be the value of the job he/she obtains discounted by a factor of e^-γt, where t is the time spent searching and γ > 0. It is shown that a unique evolutionarily stable strategy (ESS) exists for such problems. Two iterative algorithms for approximating the ESS are considered. In the case where there are only two types of job, the ESS can be calculated directly.

In this paper a quantity-setting duopoly is considered where one firm develops a new product which is horizontally differentiated from the existing product. The main question examined is which strategically important effects occur if the decision to develop the innovation and the decision to introduce the new product in the market are separated. In our multi-stage game the firm's launch decision is explicitly taken into account. We find an equilibrium where the competitor of the potential innovator strategically over-invests in process innovation in order to push the potential innovator to introduce the new product since this reduces competition for the existing product. It is shown that this effect has positive welfare implications in comparison with the case where the innovator commits ex ante to launching the new product.

We propose an abstract approach to coalition formation that focuses on simple merge and split rules transforming partitions of a group of players. We identify conditions under which every iteration of these rules yields a unique partition. The main conceptual tool is a specific notion of a stable partition. The results are parametrized by a preference relation between partitions of a group of players and naturally apply to coalitional TU-games, hedonic games and exchange economy games.

In this paper we study linear symmetric solutions for the space of games in partition function form with n players. In particular, we provide an expression for all linear, symmetric and efficient solutions. Furthermore, adding an additional axiom, we identify a unique value satisfying these properties.

In this note we provide a neccesary and sufficient condition for the non-emptiness of the socially stable core of a general structured TU-game which resembles closely the classical condition of balancedness given by Bondareva (1963) and Shapley (1967) to guarantee the non-emptiness of the classical core. Structured games have been introduced in Herings et al. (2007a) and more recently, in Herings et al. (2007b), studied in the framework of games with transferable utility. In the latter paper, the authors provide suffcient conditions for the non-emptiness of the socially stable core, but up to now, no necessary and sufficient condition is known.