{"paper":{"title":"Efficient liability assignment under shock propagation","license":"http://creativecommons.org/licenses/by/4.0/","headline":"Proportional liability rules with network-only weights induce agents to select paths minimizing total cascade losses.","cross_cats":[],"primary_cat":"econ.TH","authors_text":"Alexandros Rigos, Jens Gudmundsson, Jens Leth Hougaard, Kohmei Makihara","submitted_at":"2026-05-14T07:25:52Z","abstract_excerpt":"We study a model in which shocks propagate along a path chosen by agents embedded in a network. When a shock hits an agent, the affected agent cancels one of her outgoing edges. This cancellation cascades sequentially along a chosen path until reaching a terminal agent, resulting in a systemic cost equal to the sum of individual cancellation losses. A liability rule determines agent payments for realized losses, and we seek to implement efficient path selection in the induced sequential-move game. Our main axiomatic result characterizes a family of rules, which set each agent's liability to be"},"claims":{"count":4,"items":[{"kind":"strongest_claim","text":"Our main axiomatic result characterizes a family of rules, which set each agent's liability to be proportional to the system's total realized losses with agent weights depending only on the network structure.","source":"verdict.strongest_claim","status":"machine_extracted","claim_id":"C1","attestation":"unclaimed"},{"kind":"weakest_assumption","text":"The sequential-move game induced by the liability rule leads agents to select efficient paths; this relies on the assumption that the cascade mechanism and loss structure are exactly as modeled and that agents act to minimize their own expected liability under the proportional rule.","source":"verdict.weakest_assumption","status":"machine_extracted","claim_id":"C2","attestation":"unclaimed"},{"kind":"one_line_summary","text":"A family of liability rules sets payments proportional to total realized losses with network-structure weights that implement efficient path selection in sequential shock games, coinciding with the Shapley value of a path-counting cooperative game and computable in polynomial time.","source":"verdict.one_line_summary","status":"machine_extracted","claim_id":"C3","attestation":"unclaimed"},{"kind":"headline","text":"Proportional liability rules with network-only weights induce agents to select paths minimizing total cascade losses.","source":"verdict.pith_extraction.headline","status":"machine_extracted","claim_id":"C4","attestation":"unclaimed"}],"snapshot_sha256":"7947653e48a10fcfeafa17c2a505c02c9440d3dd3da8719bb2ba71dad6763d19"},"source":{"id":"2605.14485","kind":"arxiv","version":1},"verdict":{"id":"7b57077a-412d-46d0-bdf7-a1bf3bf33d4f","model_set":{"reader":"grok-4.3"},"created_at":"2026-05-15T01:38:37.345766Z","strongest_claim":"Our main axiomatic result characterizes a family of rules, which set each agent's liability to be proportional to the system's total realized losses with agent weights depending only on the network structure.","one_line_summary":"A family of liability rules sets payments proportional to total realized losses with network-structure weights that implement efficient path selection in sequential shock games, coinciding with the Shapley value of a path-counting cooperative game and computable in polynomial time.","pipeline_version":"pith-pipeline@v0.9.0","weakest_assumption":"The sequential-move game induced by the liability rule leads agents to select efficient paths; this relies on the assumption that the cascade mechanism and loss structure are exactly as modeled and that agents act to minimize their own expected liability under the proportional rule.","pith_extraction_headline":"Proportional liability rules with network-only weights induce agents to select paths minimizing total cascade losses."},"references":{"count":46,"sample":[{"doi":"","year":null,"title":"Anshelevich, E. and Dasgupta, A. and Kleinberg, J. and Tardos, E. and Wexler, T. and Roughgarden, T. , title =. 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