Stable sets in economies with club goods

Japneet Kaur (japneet@igidr.ac.in)
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Japneet Kaur: Indira Gandhi Institute of Development Research

Indira Gandhi Institute of Development Research, Mumbai Working Papers from Indira Gandhi Institute of Development Research, Mumbai, India

Abstract: In an economy with club goods, we introduce the concept of von Neumann-Morgensetern stable sets. Our main result provides a correspondence between stable sets of a club economy comprising a continuum of agents and finitely many types with those that form in the related finite economy. Along with the trade in private goods, agents in our economy can belong to multiple clubs. A club is characterised by the undertaking in which it is engaged and the external attributes of its members. Further, inspired by Harsanyi [10], we also bring in the notion of `sophisticated stability' and show an equivalence between `sophisticated stable sets' in the utility space with those that form in the allocation space.

Keywords: Club goods; Stable sets of allocations; Stable sets of payoffs; Core; Sophisticated stability (search for similar items in EconPapers)
JEL-codes: D50 D51 D60 D61 D71 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2023-11
New Economics Papers: this item is included in nep-gth and nep-upt
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