Considering a repeated network formation game, we suppose that the player who has the largest set of neighbors in a network may leave the game with a positive probability. This effect is called a 'shock'. The shock may appear only once, and the game round at which the shock is appeared is chosen at random. Dealing with a cooperative framework of the repeated game, we find the Shapley value, the cooperative solution, in an explicit form. It turns out that the Shapley value is subgame inconsistent for the considered model. The fact of subgame inconsistency may break the cooperative agreement. To prevent players from breaking the agreement, we design a mechanism of stage payments.

Original languageEnglish
Title of host publicationProceedings of the 2015 27th Chinese Control and Decision Conference, CCDC 2015
PublisherInstitute of Electrical and Electronics Engineers Inc.
Pages6449-6455
Number of pages7
ISBN (Electronic)9781479970179
DOIs
StatePublished - 17 Jul 2015
Event27th Chinese Control and Decision Conference, CCDC 2015 - Qingdao, China
Duration: 23 May 201525 May 2015

Publication series

NameProceedings of the 2015 27th Chinese Control and Decision Conference, CCDC 2015

Conference

Conference27th Chinese Control and Decision Conference, CCDC 2015
Country/TerritoryChina
CityQingdao
Period23/05/1525/05/15

    Scopus subject areas

  • Control and Systems Engineering
  • Control and Optimization
  • Management Science and Operations Research

    Research areas

  • characteristic function, cooperation, network formation, repeated game, subgame consistency, the Shapley value

ID: 3940011