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The alliance formation puzzle and capacity constraints

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  • Konrad, Kai A.
  • Kovenock, Dan

Abstract

The formation of an alliance in conflict situations is known to suffer from a collective action problem and from the potential of internal conflict. We show that budget constraints of an intermediate size can overcome this strong disadvantage and explain the formation of alliances. -- Die Bildung von Allianzen in Konfliktsituationen induziert zwei Probleme: Partner in einer Allianz stehen vor dem Problem kollektiven Handelns, insofern ihr eigener Beitrag zum Erfolg der Allianz auch den anderen Allianzmitgliedern zu Gute kommt. Zudem entsteht innerhalb der Allianz ein Konflikt über die Aufteilung dessen, was die Allianz gewinnt. Das wirft die Frage auf, weshalb Allianzen überhaupt gebildet werden. In dieser Arbeit zeigen die Autoren, dass Budgetbeschränkungen mittlerer Größe es ermöglichen, beide Probleme zu überwinden und die Bildung von Allianzen Vorteile für alle Allianzmitglieder entstehen können. Dies liefert eine Erklärung von Allianzen in Konfliktsituationen.

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Paper provided by Social Science Research Center Berlin (WZB) in its series Discussion Papers, Research Unit: Market Processes and Governance with number SP II 2008-07.

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Date of creation: 2008
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Handle: RePEc:zbw:wzbmpg:spii200807

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Keywords: Alliance formation puzzle; military conflict; budget constraints;

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  1. Wärneryd, Karl, 1997. "Distributional Conflict and Jurisdictional Organization," Working Paper Series in Economics and Finance 173, Stockholm School of Economics.
  2. Michelle R. Garfinkel, 2004. "On the Stability of Group Formation: Managing the Conflict Within," Conflict Management and Peace Science, Peace Science Society (International), vol. 21(1), pages 43-68, February.
  3. Skaperdas, Stergios, 1998. " On the Formation of Alliances in Conflict and Contests," Public Choice, Springer, vol. 96(1-2), pages 25-42, July.
  4. Baye, M. & Kovenock, D. & Vries, C. de, 1990. "The All-Pay Auction with Complete Information," Discussion Paper 1990-51, Tilburg University, Center for Economic Research.
  5. Joan Esteban & Jozsef Sakovics, 2004. "Olson vs. Coase: coalitional worth in conflict," ESE Discussion Papers 81, Edinburgh School of Economics, University of Edinburgh.
  6. José Alcalde & Matthias Dahm, 2007. "All-Pay Auction Equilibria In Contests," Working Papers. Serie AD 2007-27, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  7. Kai A. Konrad & Wolfgang Leininger, 2007. "Self-enforcing Norms and the Efficient Non-cooperative Organization of Clans," Ruhr Economic Papers 0016, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
  8. Dan Kovenock & Brian Roberson, 2012. "Coalitional Colonel Blotto Games with Application to the Economics of Alliances," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(4), pages 653-676, 08.
  9. Konrad, Kai A., 2009. "Strategy and Dynamics in Contests," OUP Catalogue, Oxford University Press, number 9780199549603, September.
  10. Arye L. Hillman & John G. Riley, 1987. "Politically Contestable Rents and Transfers," UCLA Economics Working Papers 452, UCLA Department of Economics.
  11. Katz, Eliakim & Tokatlidu, Julia, 1996. "Group competition for rents," European Journal of Political Economy, Elsevier, vol. 12(4), pages 599-607, December.
  12. Harris, Christopher & Reny, Philip & Robson, Arthur, 1995. "The Existence of Subgame-Perfect Equilibrium in Continuous Games with Almost Perfect Information: A Case for Public Randomization," Econometrica, Econometric Society, vol. 63(3), pages 507-44, May.
  13. Che, Yeon-Koo & Gale, Ian, 1997. " Rent Dissipation When Rent Seekers Are Budget Constrained," Public Choice, Springer, vol. 92(1-2), pages 109-26, July.
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Cited by:
  1. Ke, Changxia, 2013. "Fight Alone or Together? The Need to Belong," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 421, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
  2. Changxia Ke & Kai A. Konrad & Florian Morath, 2010. "Brothers in Arms - An Experiment on the Alliance Puzzle," CESifo Working Paper Series 3302, CESifo Group Munich.
  3. Kai Konrad, 2012. "Information alliances in contests with budget limits," Public Choice, Springer, vol. 151(3), pages 679-693, June.
  4. Iryna Topolyan, 2014. "Rent-seeking for a public good with additive contributions," Social Choice and Welfare, Springer, vol. 42(2), pages 465-476, February.
  5. Konrad, Kai A., 2010. "Dynamic contests," Discussion Papers, Research Professorship & Project "The Future of Fiscal Federalism" SP II 2010-10, Social Science Research Center Berlin (WZB).
  6. Jay Pil Choi & Subhasish M. Chowdhury & Jaesoo Kim, 2011. "Group Contests with Internal Conflict and Power Asymmetry," University of East Anglia Applied and Financial Economics Working Paper Series 025, School of Economics, University of East Anglia, Norwich, UK..
  7. Konrad, Kai A., 2011. "Strategic aspects of fighting in alliances," Discussion Papers, Research Professorship & Project "The Future of Fiscal Federalism" SP II 2011-105, Social Science Research Center Berlin (WZB).
  8. Herbst, Luisa & Konrad, Kai A. & Morath, Florian, 2013. "Endogenous group formation in experimental contests," Discussion Papers, Research Unit: Economics of Change SP II 2013-301, Social Science Research Center Berlin (WZB).

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