Publications

Reza Olfati-Saber. (2026).

Classical cooperative game theory takes the characteristic function as an unstructured primitive: it can allocate a surplus but cannot derive one. Coalition Intelligence Theory equips the characteristic function with decomposable causal factors: the companion paper constructs v(F) = D(F) · R(F) and proves a Spectral Invariance Theorem separating a structural layer from an interchangeable domain layer. This paper develops the domain layer through five nonlinear specializations, each entering a major field of economics. Increasing returns to variety nests Ricardo, Heckscher–Ohlin, Krugman, and Dixit–Stiglitz in one gains decomposition, yields unconditional superadditivity, and reveals a reversal from dissipating to permanent cross-agent rents. Network-enhanced returns derive winner-take-all from the convexity of total network value. Coordination-dependent returns provide microfoundations for the theory of the firm without behavioral assumptions. Concave and sector-heterogeneous returns extend the framework to diminishing returns and multi-sector economies. The decomposition transforms cooperative game theory from a theory of division into a theory of design.

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Classical cooperative game theory solves the allocation and stability problems for a characteristic function v: 2^N → ℝ supplied from outside. Because v is an unexplained primitive, the theory can allocate a surplus but cannot derive one, diagnose vulnerability, or measure adaptive capacity. This paper develops Coalition Intelligence Theory, a structural theory that equips v with decomposable causal factors. Agents carry capability vectors factored into a magnitude and a profile; the coalition's state is the profile density matrix ρ_F, and its value is v(F) = D(F) · R(F), rank diversity times an aggregate resource function. A Spectral Invariance Theorem separates a structural layer — density matrix, entropy, null space, collapse threshold, adaptive capacity — from an interchangeable domain layer. The spectrum of ρ_F organizes three independent roles of diversity: value creation, through superadditivity and an exact Shapley decomposition whose span-expansion bonus is a scarcity rent dissipating as 1/n once the coalition exceeds its capability dimension; resilience, through a collapse threshold that is positive iff profiles span the full space and is controlled linearly by the entropy near homogeneity; and adaptation, through a Fisher–Coalition theorem making expected improvement proportional to profile variance. A structural fragility theorem shows that extraction-driven homogenization destroys all three simultaneously — three independent collapses of one spectrum. Applications to extractive institutions and international trade, the latter unifying Ricardian and Heckscher–Ohlin comparative advantage, follow with seven falsifiable predictions.