Vincent Vannetelbosch (CORE, Université catholique de Louvain) Jean-François Caulier (Universitaires Saint-Louis) Ana Mauleon (FNRS and CEREC, CORE, Université catholique de Louvain)
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We develop a theoretical framework that allows us to study which bilateral links and coalition structures are going to emerge at equilibrium. We define the notion of coalitional network to represent a network and a coalition structure, where the network specifies the nature of the relationship each individual has with his coalition members and with individuals outside his coalition. To predict the coalitional networks that are going to emerge at equilibrium we propose the concept of contractual stability which requires that any change made to the coalitional network needs the consent of both the deviating players and their original coalition partners. We show that there always exists a contractually stable coalitional network under the simple majority decision rule and the component-wise egalitarian or majoritarian allocation rules. Moreover, requiring the consent of group members may help to reconcile stability and efficiency.
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Paper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number
2009.47.
CAULIER, Jean-Franois & MAULEON, Ana & VANNETELBOSCH, Vincent, 2008.
"Contractually stable networks,"
CORE Discussion Papers
2008066, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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Find related papers by JEL classification: A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
MAULEON, Ana & SEMPERE-MONERRIS, Jose & VANNETELBOSCH, Vincent J., 2005.
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CORE Discussion Papers
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[Downloadable!]
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"Bilateralism And Free Trade,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 47(3), pages 749-778, 08.
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Other versions:
Jackson, Matthew O. & van den Nouweland, Anne, 2002.
"Strongly Stable Networks,"
Working Papers
1147, California Institute of Technology, Division of the Humanities and Social Sciences.
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