What question did this study set out to answer?

To explore how game theory can improve financial cost and depreciation allocations in firms with interacting assets.

March 18, 2026

Financial Cost Allocations: A Game-Theoretic Approach.

Key Points

To explore how game theory can improve financial cost and depreciation allocations in firms with interacting assets.
Applied the game-theoretic Shapley technique to financial cost allocations.
Focused on depreciation allocations through net-revenue-contributions approach.
Developed three reasonable allocation axioms for acceptance by accountants.
Established that Shapley-based allocations are non-arbitrary.
Demonstrated that allocations can be corrigible with proposed axioms.
Highlighted potential improvements in financial practices when using game-theoretic methods.

Abstract

Abstract Arthur L. Thomas has argued that financial cost allocations in general and depreciation allocations in particular are arbitrary and incorrigible whenever the firm's revenues are generated by interacting assets. The game-theoretic Shapley technique is applied to the net-revenue-contributions approach to depreciation allocations. The resulting allocations, it is maintained, are non-arbitrary and corrigible if statement users and the accounting profession are willing to accept a constitution of three "reasonable" allocation axioms.

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Financial Cost Allocations: A Game-Theoretic Approach.

Key Points

Abstract

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