A claims problem approach to the cost allocation of a minimum cost spanning tree

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Title: A claims problem approach to the cost allocation of a minimum cost spanning tree
Authors: Giménez Gómez, José Manuel | Peris, Josep E. | Subiza, Begoña
Research Group/s: Desarrollo, Métodos Cuantitativos y Teoría Económica (DMCTE)
Center, Department or Service: Universidad de Alicante. Departamento de Fundamentos del Análisis Económico
Keywords: Minimum cost spanning tree problem | Claims problem | Cost sharing rules | Core selection
Knowledge Area: Fundamentos del Análisis Económico
Issue Date: 31-Mar-2021
Publisher: Springer Nature
Citation: Operational Research. 2022, 22: 2785-2801. https://doi.org/10.1007/s12351-021-00632-7
Abstract: We propose to allocate the cost of a minimum cost spanning tree by defining a claims problem and using claims rules, then providing easy and intuitive ways to distribute this cost. Depending on the starting point that we consider, we define two models. On the one hand, the benefit-sharing model considers individuals’ costs to the source as the starting point, and then the benefit of building the efficient tree is shared by the agents. On the other hand, the costs-sharing model starts from the individuals’ minimum connection costs (the cheapest connection they can use), and the additional cost, if any, is then allocated. As we prove, both approaches provide the same family of allocations for every minimum cost spanning tree problem. These models can be understood as a central planner who decides the best way to connect the agents (the efficient tree) and also establishes the amount each agent has to pay. In so doing, the central planner takes into account the maximum and minimum amount they should pay and some equity criteria given by a particular (claims) rule. We analyze some properties of this family of cost allocations, specially focusing in coalitional stability (core selection), a central concern in the literature on cost allocation.
Sponsor: Financial support from the Spanish Ministry of Economy and Competitiveness under projects PID2019-105982GB-I00/AEI/10.13039/501100011033 and ECO2016-77200-P, and from Universitat Rovira i Virgili and Generalitat de Catalunya under projects 2019PRF-URV-B2-B3 and 2019SGR770, is gratefully acknowledged.
URI: http://hdl.handle.net/10045/115028
ISSN: 1866-1505
DOI: 10.1007/s12351-021-00632-7
Language: eng
Type: info:eu-repo/semantics/article
Rights: © The Author(s), under exclusive licence to Springer-Verlag GmbH Germany, part of Springer Nature 2021
Peer Review: si
Publisher version: https://doi.org/10.1007/s12351-021-00632-7
Appears in Collections:INV - DMCTE - Artículos de Revistas

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