A Simple Bargaining Procedure for the Myerson Value

We consider situations where the cooperation and negotiation possibilities between pairs of agents are given by an undirected graph. Every connected component of agents has a value, which is the total surplus the agents can generate by working together. We present a simple, sequential, bilateral bargaining procedure, in which at every stage the two agents in a link (i, j) bargain about their share from cooperation in the connected component they are part of. We show that, if the marginal value of a link is increasing in the number of links in the connected component it belongs to, then this procedure yields exactly the Myerson value payoff (Myerson, 1977) for every player.Myerson value, networks, bargaining, cooperation