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Solidarity to achieve stability

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arxiv 2302.07618 v2 pith:XNDHC326 submitted 2023-02-15 econ.TH

classification econ.TH
keywords sharingagentscoalitionsolidarityachievecoalitionsformationproblem
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Agents may form coalitions. Each coalition shares its endowment among its agents by applying a sharing rule. The sharing rule induces a coalition formation problem by assuming that agents rank coalitions according to the allocation they obtain in the corresponding sharing problem. We characterize the sharing rules that induce a class of stable coalition formation problems as those that satisfy a natural axiom that formalizes the principle of solidarity. Thus, solidarity becomes a sufficient condition to achieve stability.

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