When does the private provision of a public good prevent conflict?

Artyom Jelnov and Doron Klunover

Economics Letters, 2020, vol. 192, issue C

Abstract: We consider a two-stage model, in which n players with the same preferences and different incomes compete for a common value prize and then contribute to a pure public good. We derive the sufficient and necessary condition under which there exists a Subgame Perfect Equilibrium in which a contest is not held. In particular, in order to maintain peace, the “poorest” player needs to contribute to the public good in every realization and therefore cannot be too poor. Peace therefore depends on the strength of the weakest player as well as on the value of the prize. The model may help in understanding conflicts between countries with a common interest.

Keywords: Contest; Public good; Conflict (search for similar items in EconPapers)
JEL-codes: C72 D74 H41 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:192:y:2020:i:c:s0165176520301609

DOI: 10.1016/j.econlet.2020.109225

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