Chapter 5
Coalition Formation
Debraj Ray*; Rajiv Vohra† * Department of Economics, New York University, New York, NY, USA† Department of Economics, Brown University, Providence, RI, USA
Abstract
This chapter surveys a sizable and growing literature on coalition formation. We refer to theories in which one or more groups of agents (“coalitions”) deliberately get together to jointly determine within-group actions, while interacting noncooperatively across groups. The chapter describes a variety of solution concepts, using an umbrella model that adopts an explicit real-time approach. Players band together, perhaps disband later and re-form in shifting alliances, all the while receiving payoffs at each date according to the coalition structure ...
