Stable Outcomes For Contract Choice Problems

In this paper, we consider the problem of choosing a set of multi-party contracts, where each coalition of agents has a non-empty finite set of feasible contracts to choose from. We call such problems, contract choice problems. We provide conditions under which a contract choice problem has a non-empty set of "stable" outcomes. There are two types of stability concepts we study in this paper: cooperative stability and non-cooperative stability. The cooperative stability concept that we invoke here is the core. We also show, that a simple generalization of the Deferred Acceptance Procedure with men proposing due to Gale and Shapley (1962), yields outcomes for a generalized marriage problem, which necessarily belong the core. The non-cooperative stability concept that we study here is individual stability. The final result of this paper states that every contract choice problem has a non-empty weak bargaining set.