Minimum cost spanning tree problems as value sharing problems

No 2101, Working Papers from University of Windsor, Department of Economics

Abstract: Minimum cost spanning tree (mcst) problems study situations in which agents must connect to a source to obtain a good, with the cost of building an edge being independent of the number of users. We reinterpret mcst problems as value sharing problems, and show that the folk and cycle-complete solutions, two of the most studied cost-sharing solutions for mcst problems, do not share values in a consistent way. More precisely, two mcst problems yielding the same value sharing problem might lead to value being shared in different ways. However, they satisfy a weaker version of the property that applies only to elementary problems, in which the cost on an edge can only be 0 or 1. The folk solution satisfies the version related to the public approach, while the cycle-complete solution satisfies the one related to the private approach, which differ depending if we allow a group to use the nodes of other agents or only their own nodes. We then build axiomatizations built on these properties. While the two solutions are usually seen as competitors in the private approach, the results point towards a different interpretation: the two solutions are based on different interpretations of the mcst problem, but are otherwise conceptually very close.

Keywords: Minimum cost spanning tree; value sharing; cycle-complete solution; folk solution. (search for similar items in EconPapers)
JEL-codes: C71 D63 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2021-03
New Economics Papers: this item is included in nep-gth
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http://web2.uwindsor.ca/economics/RePEc/wis/pdf/2101.pdf First version, 2021 (application/pdf)

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Journal Article: Minimum cost spanning tree problems as value sharing problems (2023)
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