A substitute for the classical Neumann-Morgenstern characteristic function in cooperative differential games

DOI10.3934/JDG.2020007zbMATH Open1447.91010arXiv1907.07528OpenAlexW3019979546MaRDI QIDQ2197183FDOQ2197183

Yanyan Li

Publication date: 28 August 2020

Published in: Journal of Dynamics and Games (Search for Journal in Brave)

Abstract: In this paper, we present a systematic overview of different endogenous optimization-based characteristic functions and discuss their properties. Furthermore, we define and analyze in detail a new, $eta$-characteristic function. This characteristic function has a substantial advantage over other characteristic functions in that it can be obtained with a minimal computational effort and has a reasonable economic interpretation. In particular, the new characteristic function can be seen as a reduced version of the classical Neumann-Morgenstern characteristic function, where the players both from the coalition and from the complementary coalition use their previously computed strategies instead of solving respective optimization problems. Our finding are illustrated by a pollution control game with $n$ non-identical players. For the considered game, we compute all characteristic functions and compare their properties. Quite surprisingly, it turns out that both the characteristic functions and the resulting cooperative solutions satisfy some symmetry relations.

Full work available at URL: https://arxiv.org/abs/1907.07528

zbMATH Keywords

characteristic functioncooperative gamesdifferential gamespollution control

Mathematics Subject Classification ID

Cooperative games (91A12) Differential games and control (49N70) Differential games (aspects of game theory) (91A23) Applications of optimal control and differential games (49N90) Dynamic games (91A25)

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Cited In (9)

• A cooperation scheme in multistage game of renewable resource extraction with asymmetric players
• Cooperative optimality principles in differential games on networks
• The core of cooperative differential games on networks
• Comparison of methods of organization and management efficiency in dynamic models of Cournot oligopoly
• On the symmetry relation between different characteristic functions for additively separable cooperative games
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• Cooperative differential games with continuous updating using Hamilton–Jacobi–Bellman equation
• Strong Time-Consistency of a Core: An Application to the Pollution Control Problem in Eastern Siberia
• Characteristic functions of cooperative differential games

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