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Cooperative production and efficiency

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  • Beviá, Carmen
  • Corchón, Luis C.

Abstract

We characterize the sharing rule for which a contribution mechanism achieves efficiency in a cooperative production setting when agents are heterogeneous. This rule differs from the one obtained by Sen for the case of identical agents. We also show for a large class of sharing rules that if Nash equilibrium yields efficient allocations, the production function displays constant returns to scale, a case in which cooperation in production is useless.

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  • Beviá, Carmen & Corchón, Luis C., 2009. "Cooperative production and efficiency," Mathematical Social Sciences, Elsevier, vol. 57(2), pages 143-154, March.
    • Handle: RePEc:eee:matsoc:v:57:y:2009:i:2:p:143-154
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    References listed on IDEAS

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    Cited by:

    1. Beviá, Carmen & Corchón, Luis C., 2017. "Growth in Illyria: The role of meritocracy in the accumulation of human capital," Mathematical Social Sciences, Elsevier, vol. 90(C), pages 182-190.

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    More about this item

    Keywords

    Cooperative production Efficiency Incentives;

    JEL classification:

    • D29 - Microeconomics - - Production and Organizations - - - Other
    • D6 - Microeconomics - - Welfare Economics
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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