Arbitration and stability in cooperative games

Abstract

We present a formal framework for handling deviation in settings where players divide resources among multiple projects, forming overlapping coalition structures. Having formed such a coalition structure, players share the revenue generated among themselves. Given a profit division, some players may decide that they are underpaid, and deviate from the outcome. The main insight of the work presented in this survey is that when players want to deviate, they must know how the non-deviators would react to their deviation: after the deviation, the deviators may still work with some of the non-deviators, which presents an opportunity for the non-deviators to exert leverage on deviators. We extend the overlapping coalition formation (OCF) model of Chalkiadakis et al. [2010] for cooperation with partial coalitions, by introducing arbitration functions , a general framework for handling deviation in OCF games. We review some interesting aspects of the model, characterizations of stability in this model, as well as methods for computing stable outcomes.