Ryusuke Shinohara

The possibility of efficient provision of a public good in voluntary participation games

In this study, we provide the conditions for efficient provision of a public good in a participation game in which a non-negative integer number of units of the public good can be provided. In the case in which at most one unit of the public good can be provided, we provide refinements of Nash equilibria at which agents choose only a Nash equilibrium with an efficient allocation and provide sufficient conditions for cost-sharing rules that guarantee the existence of a Nash equilibrium with an efficient allocation. In the case of a multi-unit public good, we provide a necessary and sufficient condition for the existence of a Nash equilibrium with an efficient allocation and prove that Nash equilibria are less likely to support efficient allocations if the participation of many agents is needed for efficient provision of the public good in the case of identical agents.

What Factors Determine the Number of Trading Partners

The purpose of the paper is to provide a simple model explaining buyer-supplier relationships and show what factors determine the number of trading partners. We show that when the supplier is able to determine the number of trading partners, the optimal number is small if the suppliers bargaining power with them is weak, the economy of scope in the suppliers variable costs is significant, and that in its sunk investment is weak. Investment may be greater when the number of trading partners is small. The results may be consistent with the formation of Japanese buyer-supplier relations.

Participation and Demand Levels for a Joint Project

We examine a voluntary participation game in public good provision in which each agent has a demand level for the public good. The agent’s demand level is the minimum level of the public good from which she can receive a positive benefit. In this game, there exists a subgame perfect Nash equilibrium at which the (Pareto) efficient allocation is achieved. The voluntary participation game may also have a subgame perfect Nash equilibrium with underprovision of the public good. However, some subgame perfect Nash equilibrium with the efficient allocation satisfies strong perfection, introduced by Rubinstein (Int J Game Theory 9:1–12, 1980), and strong perfection is satisfied only by the subgame perfect Nash equilibrium with the efficient allocation. Furthermore, all payoffs at strong perfect equilibria belong to the core of the enterprise game. By these results, we conclude that in our case, the voluntary participation problem is not as serious as the earlier studies report. We also discuss the extensibility of these results.

A Voluntary Participation Game through a Unit-by-Unit Cost Share Mechanism of a Non-Excludable Public Good

The strategic analysis of voluntary participation in the public good provision has shown two distinct results. First, when the provision of public goods is binary, there are Nash equilibria supporting efficient allocations, and these are Strong Nash equilibria of the game. On the other hand, a model of a continuous public good (Saijo–Yamato, J Econ Theory 84:227–242, 1999) showed that the participation of all agents is not an equilibrium in many situations. This article considers the provision of a discrete and multi-unit public good, and examines a unit-by-unit participation game. Namely, people are asked to participate in each unit of public good provision, and those who chose to participate share the marginal cost of public good. In this game of public good provision, there are subgame-perfect equilibria that are Pareto efficient. We also use the refinement concepts to eliminate inefficient subgame-perfect equilibria and also to characterize the efficient subgame-perfect equilibria.

Coalition-proofness in a class of games with strategic substitutes

We examine the coalition-proofness and Pareto properties of Nash equilibria in pure strategy

Undertaking Nonharmful or Harmful Public Projects Through Unit-by-Unit Contribution: Coordination and Pareto Efficiency

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Private Provision of Public Goods that are Complements for Private Goods: Application to Open Source Software Developments

σ-interactive games with strategic substitutes and increasing/decreasing externalities. For this class of games: (i) we prove the equivalence among the set of Nash equilibria, the set of coalition-proof Nash equilibria under strong Pareto dominance and the set of Nash equilibria that are not strongly Pareto dominated by other Nash equilibria; (ii) we prove that the fixpoints of some “ extremal” selections from the joint best reply correspondence are both coalition-proof Nash equilibria under weak Pareto dominance and not weakly Pareto dominated by other Nash equilibria. We also provide an order-theoretic characterization of the set of Nash equilibria and show various applications of our results.

COALITION-PROOF NASH EQUILIBRIA IN A NORMAL-FORM GAME AND ITS SUBGAMES

ABSTRACT We examine a trade-off between strategic delegation and the internalization of interregional externalities through bargaining in the context of political economy. We show that in the case of one-sided provision of a public good, if the public good produced by one region generates a sufficiently significant spillover to another region, then interregional negotiation increases the total surplus of the entire economy.