The Shapley value is good, but part of it is unintuitive to me. I just don’t understand why, for example in #2, the coalition is divided into the father, mother, and daughter, rather than into “those supplying the exemption” and “those applying the exemption”. Or if someone is fairly stable over time and someone else is changing rapidly, does the first person get to capture way more value because over the day of negotiations they’re one person while the other is three? And this is all still handwaving away the process of choosing which coalitions to form, but that’s a whole new question.
“Those supplying the exemption” would be the people who write the tax laws- what is their fair cut? Are we deliberately ignoring the fact that the law defines exactly who is permitted to take the exemption, and assuming that everyone involved is amicably agreeing to falsify information (if need be) to maximize the tax benefits? e.g. if the student was covering all of her expenses, she does not qualify as a dependent and no one else may claim her as a dependent.
The Shapley value is good, but part of it is unintuitive to me. I just don’t understand why, for example in #2, the coalition is divided into the father, mother, and daughter, rather than into “those supplying the exemption” and “those applying the exemption”. Or if someone is fairly stable over time and someone else is changing rapidly, does the first person get to capture way more value because over the day of negotiations they’re one person while the other is three? And this is all still handwaving away the process of choosing which coalitions to form, but that’s a whole new question.
“Those supplying the exemption” would be the people who write the tax laws- what is their fair cut? Are we deliberately ignoring the fact that the law defines exactly who is permitted to take the exemption, and assuming that everyone involved is amicably agreeing to falsify information (if need be) to maximize the tax benefits? e.g. if the student was covering all of her expenses, she does not qualify as a dependent and no one else may claim her as a dependent.
Good point, given what I said I have no real reason to exclude the government from which they’re extracting “surplus”. But I wanna. ;)
(I believe falsifying information is not necessary given changes in who pays, plus the gift exclusion, but that’s beside the point.)