Discussion Papers in Economics

Planning Unit, Indian Statistical Institute, Delhi

#02-04:

Cost Monotonicity,Consistency and Minimum Cost Spanning Tree Games
By Bhaskar Dutta and Anirban Kar

Abstract

We propose a new cost allocation rule for minimum cost Spanning tree games. The new rule is a core selection and also satisfices cost monotonicity. We also give charqcterization theorems for the new rule as well as the much-studied Bird allocation. We show that the principal difference between these two rules is interms of their consistency properties. JEL Classification Numbers: D 7 Key words: spanning tree, cost allocation, core selection, cost monotonicity, consistency.

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