Collective Action and the Group Size Paradox

Joan Esteban () and Debraj Ray
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Joan Esteban: Campus de la UAB

A chapter in 40 Years of Research on Rent Seeking 1, 2008, pp 379-388 from Springer

Abstract: Abstract According to the Olson paradox, larger groups may be less successful than smaller groups in furthering their interests. We address the issue in a model with three distinctive features: explicit intergroup interaction, collective prizes with a varying mix of public and private characteristics, and nonlinear lobbying costs. The interplay of these features leads to new results. When the cost of lobbying has the elasticity of a quadratic function, or higher, larger groups are more effective no matter how private the prize. With smaller elasticities, a threshold degree of publicness is enough to overturn the Olson argument, and this threshold tends to zero as the elasticity approaches the value for a quadratic function. We also demonstrate that these results are true, irrespective of whether we examine group sizes over the cross-section in some given equilibrium or changes in the size of a given group over different equilibria.

Date: 2008
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Journal Article: Collective Action and the Group Size Paradox (2001)
Working Paper: Collective Action and Group Size Paradox (1999)
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-540-79182-9_25

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DOI: 10.1007/978-3-540-79182-9_25

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