Abstract ABSTRACT: The simple Shapley allocation has been recently proposed by several authors as a useful allocation scheme in the joint cost allocation problem. However, while satisfying several useful allocation axioms, it does have a least two debilities. First, it is a unique solution and does not permit any flexibility by management. Second, it may fail to satisfy the core conditions in many relevant situations, causing independent action by subcoalitions of divisions which is to the detriment of the corporation. A generalization of the simple Shapley allocation is proposed which maintains most of the favorable properties of the simple Shapley allocation while removing these two weaknesses.
Hamlen et al. (1980) studied this question.