Internal hierarchy and stable coalition structures

Massimo Morelli () and In-Uck Park

Games and Economic Behavior, 2016, vol. 96, issue C, 90-96

Abstract: In deciding whether to join a coalition or not, an agent must consider both i) the expected power of the coalition and ii) her position in the vertical structure within the coalition. We establish the existence of a positive relationship between the degree of inequality in remuneration within coalitions and the number of coalitions to be formed endogenously in stable systems. We show that such coalitions can be mixed and balanced, rather than segregated, in terms of members' ability levels. In any stable system each coalition is of an efficient size and every agent is paid her marginal contribution.

Keywords: Stable systems; Abilities; Cyclic partition; Non-segregation (search for similar items in EconPapers)
JEL-codes: C71 D71 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Related works:
Working Paper: Internal Hierarchy and Stable Coalition Structures (2014)
Working Paper: Internal Hierarchy and Stable Coalition Structures (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:96:y:2016:i:c:p:90-96

DOI: 10.1016/j.geb.2016.01.007

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