Cooperative location games based on the minimum diameter spanning Steiner subgraph problem

Abstract

In this paper we introduce and analyze new classes of cooperative games related to facility location models. The players are the customers (demand points) in the location problem and the characteristic value of a coalition is the cost of serving its members. Specifically, the cost in our games is the service diameter of the coalition. We study the existence of core allocations for these games, focusing on network spaces, i.e., finite metric spaces induced by undirected graphs and positive edge lengths.