Multi-issue Allocation Games

This paper introduces a new class of transferable-utility games, called multi-issue allocation games. These games arise from various allocation situations and are based on the concepts underlying the bankruptcy model, as introduced by O'Neill (1982). In this model, a perfectly divisible good (estate) has to be divided amongst a given set of agents, each of whom has some claim on the estate. Contrary to the standard bankruptcy model, the current model deals with situations in which the agents' claims are multi-dimensional, where the dimensions correspond to various issues. It is shown that the class of multi-issue allocation games coincides with the class of (nonnegative) exact games. The run-to-the-bank rule is introduced as a solution for multi-issue allocation situations and turns out to be Shapley value of the corresponding game. Finally, this run-to-the-bank rule is characterised by means of a consistency property. Dept. de Matemμatica Econμomica, Financera i Actuarial, Universitat de Barcelona. CentER and Department of Econometrics and Operations Research, Tilburg University. Corresponding author. P.O. Box 90153, 5000 LE Tilburg, The Netherlands. E-mail: [email protected].