Epsilon Cores of Games with Limited Side Payments: Nonemptiness and Equal Treatment

We introduce the concept of a parameterized collection of games with limited side payments, ruling out large transfers of utility. Under the assumption that the payoff set of the grand coalition is convex, we show that a game ∗This paper revises Autonomous University of Barcelona Working Paper number WP 392.97 and Warwick University Department of Economics Working Paper No 536. The authors are grateful to an anonymous referee for helpful comments. †This research was undertaken with support from the European Union’s Tacis ACE Programme 1995. At that time, this author was in the IDEA Ph.D. Program of the Autonomous University of Barcelona. Support by DGICYT, the IBM Fund Award, and the Latané Fund is acknowledged. ‡The support of the Direccio General d’Universitats of Catalonia, the Social Sciences and Humanities Research Council of Canada, and the Department of Economics of the Autonomous University of Barcelona is gratefully acknowledged.