NDLI: Linear cost share equilibria and the veto power of the grand coalition

Content Provider	Springer Nature Link
Author	Grazia, Maria Gabriella Romaniello, Maria
Copyright Year	2011
Abstract	We consider pure exchange economies with finitely many private goods involving the choice of a public project. We discuss core-equivalence results in the general framework of non-Euclidean representation of the collective goods. We define a contribution scheme to capture the fraction of the total cost of providing the project that each blocking coalition is expected to cover. We show that for each given contribution scheme defined over the wider class of Aubin coalitions, the resulting core is equivalent to the corresponding linear cost share equilibria. We also characterize linear cost share equilibria in terms of the veto power of the grand coalition. It turns out that linear cost share equilibria are exactly those allocations that cannot be blocked by the grand coalition with reference to auxiliary economies with the same space of agents and modified initial endowments and cost functions. Unlike the Aubin-type equivalence and results presented in Diamantaras and Gilles (Soc Choice Welf 15:121–139, 1998), this characterization does not depend on a particular contribution scheme.
Starting Page	269
Ending Page	303
Page Count	35
File Format	PDF
ISSN	01761714
Journal	Social Choice and Welfare
Volume Number	38
Issue Number	2
e-ISSN	1432217X
Language	English
Publisher	Springer-Verlag
Publisher Date	2011-01-09
Publisher Place	Berlin, Heidelberg
Access Restriction	One Nation One Subscription (ONOS)
Subject Keyword	Economic Theory Economics general
Content Type	Text
Resource Type	Article
Subject	Social Sciences Economics and Econometrics

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