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- Title
The price of anarchy of serial, average and incremental cost sharing.
- Authors
Moulin, Hervé
- Abstract
We compute the price of anarchy (PoA) of three familiar demand games, i.e., the smallest ratio of the equilibrium to efficient surplus, over all convex preferences quasi-linear in money. For any convex cost, the PoA is at least 1/n in the average and serial games, where n is the number of users. It is zero in the incremental game for piecewise linear cost functions. With quadratic costs, the PoA of the serial game is theta * (1/(log n)), and theta * (1/n) for the average and incremental games. This generalizes if the marginal cost is convex or concave, and its elasticity is bounded.
- Subjects
COST; DIRECT costing; ECONOMIC demand; ECONOMIC equilibrium; GAME theory; RESOURCE allocation
- Publication
Economic Theory, 2008, Vol 36, Issue 3, p379
- ISSN
0938-2259
- Publication type
Article
- DOI
10.1007/s00199-007-0275-y