Coalition formation in weighted simple-majority games under proportional payoff allocation rules

In this paper, we introduce a simple coalition formation game in the environment of bidding, which is a special case of the weighted majority game (WMG), and is named the weighted simple-majority game (WSMG). In WSMG, payoff is allocated to the winners proportional to the players’ powers, which can be measured in various ways. We define a new kind of stability: the counteraction-stability (C-stability), where any potential deviating players will confront counteractions of the other players. We show that C-stable coalition structures in WSMG always contains a minimal winning coalition of minimum total power. For the variant where powers are measured directly by their weights, we show that it is NP-hard to find a C-stable coalition structure and design a pseudo-polynomial time algorithm. Sensitivity analysis for this variant, which shows many interesting properties, is also done. We also prove that it is NP-hard to compute the Holler-Packel indices in WSMGs, and hence in WMGs as well.