Network Bargaining: Using Approximate Blocking Sets to Stabilize Unstable Instances

We study a network extension to the Nash bargaining game, as introduced by Kleinberg and Tardos [9], where the set of players corresponds to vertices in a graph G=(V,E) and each edge ij∈E represents a possible deal between players i and j. We reformulate the problem as a cooperative game and study the following question: Given a game with an empty core (i.e. an unstable game) is it possible, through minimal changes in the underlying network, to stabilize the game? We show that by removing edges in the network that belong to a blocking set we can find a stable solution in polynomial time. This motivates the problem of finding small blocking sets. While it has been previously shown that finding the smallest blocking set is NP-hard [3], we show that it is possible to efficiently find approximate blocking sets in sparse graphs.

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