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The Role and Evolution of Central Authorities

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  • Paul Frijters

    ()

  • Alexander F. Tieman

    ()
    (Vrije Universiteit Amsterdam)

Abstract

In this paper we argue that authorities aid cooperation by means ofdirect coordination or the enforcement of re-commitment devices suchas contract laws.Credible threats of violence allow this role. In alocal interaction model, an authority forms if mutually connected individuals with sufficient combined punishment potential have signalled their willingness to form such an authority, conditional upon the willigness of others todo so. Given a specific timing of decisions, we analyse the conditions under which authorities arise and under which they evolve into a stationary state with only one or several remaining authorities.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 99-053/1.

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Date of creation: 05 Aug 1999
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Handle: RePEc:dgr:uvatin:19990053

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Web page: http://www.tinbergen.nl

Related research

Keywords: Central Authorities; Cooperation; Evolution; Externalities; Local Interaction;

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  1. Xander F. Tieman & Gerard van der Laan & Harold Houba, 1996. "Bertrand Price Competition in a Social Environment," Tinbergen Institute Discussion Papers 96-140/8, Tinbergen Institute.
  2. Young, H Peyton, 1993. "The Evolution of Conventions," Econometrica, Econometric Society, vol. 61(1), pages 57-84, January.
  3. Joseph Farrell & Matthew Rabin, 1996. "Cheap Talk," Journal of Economic Perspectives, American Economic Association, vol. 10(3), pages 103-118, Summer.
  4. Asheim, G.B., 1991. "Individual and Collective Time Consistency," Papers 9169, Tilburg - Center for Economic Research.
  5. Alexander Tieman & Harold Houba & Gerard Laan, 2000. "On the level of cooperative behavior in a local-interaction model," Journal of Economics, Springer, vol. 71(1), pages 1-30, February.
  6. Debraj Ray & Dilip Mookherjee & Fernando Vega Redondo & Rajeeva L. Karandikar, 1996. "Evolving aspirations and cooperation," Working Papers. Serie AD 1996-06, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  7. Martin J. Osborne & Ariel Rubinstein, 1994. "A Course in Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650401, January.
  8. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard, 1986. "Fairness as a Constraint on Profit Seeking: Entitlements in the Market," American Economic Review, American Economic Association, vol. 76(4), pages 728-41, September.
  9. Burbidge, John B. & James A. DePater & Gordon M. Meyers & Abhijit Sengupta, 1997. "A Coalition-Formation Approach to Equilibrium Federations and Trading Blocs," American Economic Review, American Economic Association, vol. 87(5), pages 940-56, December.
  10. Eshel, I. & Samuelson, L. & Shaked, A., 1996. "Altruists, Egoists and Hooligans in a Local Interaction Model," Working papers 9612, Wisconsin Madison - Social Systems.
  11. Kandori, M. & Mailath, G.J., 1991. "Learning, Mutation, And Long Run Equilibria In Games," Papers 71, Princeton, Woodrow Wilson School - John M. Olin Program.
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