Subgame consistent cooperation. A comprehensive treatise (Q296646): Difference between revisions

The readers receive the very interesting extensive book (520 pages). I begin with a quotation that describes its contents exceptionally well: ``This book is a comprehensive treatise on subgame consistent dynamic cooperation covering the up-to-date state of the art analyses in this important topic. It sets out to provide the theory, solution techniques and applications of subgame consistent cooperation in a wide spectrum of paradigms for analysis which includes cooperative dynamic game models with stochastic state dynamics, with uncertain future payoffs, with asynchronous players' horizons, with random cooperation duration, with control spaces switching and with transferable and nontransferable payoffs. The book would be a significant research reference text for researchers in game theory, economists, applied mathematicians, policy-makers, corporate decision-makers, and graduate students in applied mathematics, game theory, decision sciences, economics and management sciences.'' It is also worth quoting here two short reviews about the book, belonging to known researchers in this field: ``Technically this is a high quality book. It is very relevant to researchers of dynamic games -- an area which is very relevant in nowadays research related to complex dynamic systems. The book provides original concepts, ideas and results with relevance'' as Dusan Stipanovic writes; and the second review of Vladimir Mazalov: ``The 2004 Nobel Economics Prize was given to works in economic policies under the concept of time consistency with mathematical construction less general, rigorous and precise than that later developed in this book. The concept and technique of subgame consistency were just published then. In terms of advancement in practical applications this book is highly important theoretically and technically on top of economic interpretation.'' The book consists of the three parts. Part I -- `Continuous-time analysis' (Chapters 2--6) is devoted to problems of subgame consistent cooperation in differential games, Part II -- `Discrete-time analysis' (Chapters 7--11) studies the same problems for discrete-time dynamic games, while Part III shows different applications of the presented theory. Every chapter ends with several problems for the readers. Below the contents of each chapter is shortly described. Chapter 2 presents the basic formulation of cooperative differential games, an analysis on subgame consistent dynamic cooperation, derivation of a subgame consistent payoff distribution procedure, subgame consistency in infinite horizon cooperative differential games and in cooperative resource extraction schemes. Chapter 3 presents the basic formulation of cooperative stochastic differential games and repeats considerations of Chapter 2 for such games in terms of subgame consistency under uncertainty, while Chapter 4 repeats considerations of Chapter 2 for randomly-furcating cooperative differential games. In Chapter 5, a special class of differential games is introduced and noncooperative outcomes are characterized. Also, a model with dynamic cooperation among coexisting players and dynamically consistent solutions in the asynchronous horizons scenario are considered here. Chapter 6 is the last one in Part I, where the issue of subgame consistency in cooperative stochastic differential games with nontransferable payoffs is presented. In particular, the formulation of non-transferable utility cooperative stochastic differential games, the corresponding Pareto optimal state trajectories and individual players' payoffs under cooperation are provided, and the notion of subgame consistency in NTU cooperative stochastic differential games is examined. Chapter 7 (the first one in Part II) begins with a general formulation of cooperative dynamic games in discrete time with the noncooperative outcomes, introducing the notions of group optimality and individual rationality. Next, subgame consistent cooperative solutions with corresponding payoff distribution procedures are derived, and a heuristic approach to obtaining subgame solutions for cooperative dynamic games is provided. Chapter 8 presents subgame consistent solutions in discrete-time cooperative dynamic games with random horizon. In particular, a dynamic programming technique for solving inter-temporal problems with random horizon is developed to serve as a foundation of solving game problems, and dynamic cooperation under random horizon, group optimality and individual rationality are analyzed. Chapter 9 considers subgame consistent cooperative solutions in randomly furcating stochastic discrete-time dynamic games, where the evolution of the state is stochastic and future payoff structures are not known with certainty. Among other things, group optimality and individual rationality under dynamic cooperation are discussed, and subgame consistent solutions and payment mechanism leading to the realization of these solutions are obtained. In Chapter 10, the class of randomly furating stochastic dynamic games with uncertain game horizon are investigated. It is shown for this class of games that there exist uncertainties in the state dynamics, future payoff structures and game horizon. Besides, the noncooperative Nash equilibrium is characterized and subgame consistent cooperative solutions are derived. Chapter 11 (the last one in Part II) considers subgame consistency in NTU cooperative dynamic games with the use of variable payoff weights. In particular, the notion of subgame consistency in such games is presented and derivation of subgame consistent cooperative strategies via variable weights is shown. The last four chapters (Chapters 12--15) constitute Part III of the book and are devoted to various applications of subgame consistent solutions developed in the two previous parts. In Chapter 12, subgame consistent cooperative schemes are provided to resolve the classical problem of cooperative public goods provisions, which next, are applied to an analysis of game models with asymmetric agents in public capital build-up and with uncertainties in the capital accumulation dynamics and payoff structures. Chapter 13 presents collaborative schemes for environmental management in a cooperative differential game framework and derives subgame consistent solutions for the schemes, while Chapter 14 presents a cooperative dynamic model of collaborative schemes for environmental management with production technique choices and derives a subgame consistent solution. The last Chapter 15 shows two applications in business collaboration, where the first one is on corporate joint ventures and the second one is on a cartel. Summarizing, this book is really worthy to be recommended to all who would want to extend their knowledge in game theory, decision sciences, economics and management sciences.