This paper illustrates how concepts from cooperative game theory can be used to analyze problems related to taxation and redistribution. Our point of departure is an opinion piece in a newspaper that tells the story of ten friends who dine together and split the bill proportionally according to their income. The paper contributes by linking interesting policy questions to methods that are rarely used to analyze them. We proceed to use the newspaper story as an illustration of how taxation can be seen as a cooperative game with transferable utility, and of how allocation methods can be used to split the bill (tax burden).

Keywords: cooperative game theory, taxation, redistribution, cost allocation