Group inefficiency in a common property resource game with asymmetric players
Economics Letters, 2015, vol. 136, issue C, 214-217
If the joint preferences of asymmetric players having different discount rates are represented by the sum of intertemporal utilities, they become time-inconsistent. It is shown how time-consistent solutions for this problem can be strongly inefficient: the sum of payoffs can be higher if cooperation or coordination is forbidden than if it is allowed.
Keywords: Asymmetric players; Heterogeneous discounting; Group inefficiency; Differential games; Resource games (search for similar items in EconPapers)
JEL-codes: C73 C71 Q30 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:136:y:2015:i:c:p:214-217
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