Proportionally adjusted marginal pricing method to share joint costs

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We consider the cost sharing problem with divisible demands of heterogeneous goods. We propose a cost sharing method called Proportionally Adjusted Marginal Pricing (PAMP) method. PAMPis a nonadditive (in the cost function) extension of average cost pricing.We introduce an axiom called Local Independence (LI) and use LI together with Continuity, Proportionality, and Scale Invariance to characterize PAMP.