A bargaining solution with level structure

Abstract

Presently, a conventional coalition structure can no more cover all the types of cooperative structures in practice, external cooperation between the coalitions also affects the payoff allocation between the participants. We propose a solution to solve the bargaining problem with level structure by defining for each coalition and each level. The solution concentrates on the bargaining of the coalitions with each other at each level. Furthermore, we discuss the applications of this solution to bankruptcy games with level structure. The proposed solution generalizes the bargaining solution with conventional coalition structure, which can be utilized in more cooperative types with level structures.