Cooperative games in characteristic function form

Abstract

Throughout the previous chapters the players have been assumed to choose their strategies independently. Their performance in the game has been measured solely by the pay-off they got. However, in a number of games the “benefit” gained can be increased considerably if certain players more or less give up their independence. In other words, some of the players may form “coalitions” in order to increase their pay-off. Of course forming a coalition can generally be profitable only if the coalition assures more than the sum of the pay-offs the members can achieve playing alone. Players gathered in a coalition will not choose their strategies independently any more. They strive at maximizing the coalition’s overall “profit” and possibly their own share.