Incentive-compatible cost allocations for inventory games with private information

In this paper we design cost allocation rules for inventory games with private information. First, we design incentive -compatible cost allocation rules for inventory games with private information via Vickrey-Clarke-Groves (VCG) rules. Then, we propose incentive -compatible and approximate budgetbalanced cost allocations via polynomial approximations such as the Chebyshev approximation and the Taylor approximation. In addition, we propose an incentive -compatible cost allocation with individual rationality. Finally, we conduct numerical experiments to compare the performance of the proposed cost allocations. (c) 2024 Elsevier B.V. All rights reserved.