Concepts inQuantifying inefficiency in cost-sharing mechanisms
Economic efficiency
In economics, the term economic efficiency refers to the use of resources so as to maximize the production of goods and services. An economic system is said to be more efficient than another (in relative terms) if it can provide more goods and services for society without using more resources. In absolute terms, a situation can be called economically efficient if: No one can be made better off without making someone else worse off (commonly referred to as Pareto efficiency).
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Cost
In production, research, retail, and accounting, a cost is the value of money that has been used up to produce something, and hence is not available for use anymore. In business, the cost may be one of acquisition, in which case the amount of money expended to acquire it is counted as cost. In this case, money is the input that is gone in order to acquire the thing.
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Value (economics)
An economic value is the worth of a good or service as determined by the market. The economic value of a good or service has puzzled economists since the beginning of the discipline. First, economists tried to estimate the value of a good to an individual alone, and extend that definition to goods which can be exchanged. From this analysis came the concepts value in use and value in exchange.
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Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek ¿¿¿¿¿¿¿¿¿ (oikonomia, "management of a household, administration") from ¿¿¿¿¿ (oikos, "house") + ¿¿¿¿¿ (nomos, "custom" or "law"), hence "rules of the house(hold)".
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Mechanism design
Mechanism design (sometimes called reverse game theory) is a field in game theory studying solution concepts for a class of private information games. The distinguishing features of these games are: that a game "designer" chooses the game structure rather than inheriting one that the designer is interested in the game's outcome Such a game is called a "game of mechanism design" and is usually solved by motivating agents to disclose their private information.
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