Dynamically Consistent Bi-level Cooperation of a Dynamic Game with Coalitional Blocs

Leon A. Petrosyan, David W.K. Yeung

Research outputpeer-review

Abstract

In many real-life scenarios, groups or nations with common interest form coalition blocs by agreement for mutual support and joint actions. This paper considers two levels of cooperation: cooperation among members within a coalition bloc and cooperation between the coalition blocs. Coalition blocs are formed by players with common interests to enhance their gains through cooperation. To increase their gains coalition blocs would negotiate to form a grand coalition. A grand coalition cooperation of the coalitional blocs is studied. The gains of each coalition are defined as components of the Shapley value. Dynamically consistent payoff distributions between coalitions and among players are derived for this double-level cooperation scheme. For definition of players’ gains inside each coalition the proportional solution is used.

Original languageEnglish
Title of host publicationFrontiers of Dynamic Games
Subtitle of host publicationGame Theory and Management, St. Petersburg, 2018
EditorsLeon A. Petrosyan, Vladimir V. Mazalov, Nikolay A. Zenkevich
Place of PublicationCham
PublisherBirkhäuser Verlag AG
Pages209-230
ISBN (Print)9783030236984
DOIs
Publication statusPublished - 2019

Publication series

NameStatic and Dynamic Game Theory: Foundations and Applications
ISSN (Print)2363-8516
ISSN (Electronic)2363-8524

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Scopus subject areas

  • Statistics and Probability
  • Statistics, Probability and Uncertainty
  • Applied Mathematics

Cite this

Petrosyan, L. A., & Yeung, D. W. K. (2019). Dynamically Consistent Bi-level Cooperation of a Dynamic Game with Coalitional Blocs. In L. A. Petrosyan, V. V. Mazalov, & N. A. Zenkevich (Eds.), Frontiers of Dynamic Games: Game Theory and Management, St. Petersburg, 2018 (pp. 209-230). (Static and Dynamic Game Theory: Foundations and Applications). Cham: Birkhäuser Verlag AG. https://doi.org/10.1007/978-3-030-23699-1_11