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The Group Size Paradox Revisited

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  • PAUL PECORINO
  • AKRAM TEMIMI

Abstract

Esteban and Ray (2001) model an increasing marginal cost of effort in providing a public good. If the marginal cost of contribution function has an elasticity greater than 1, then the level of provision is increasing in group size, regardless of the degree of rivalry of the public good. We modify their model to a standard public goods setting, where their results continue to hold. We then add small fixed costs of participation to the model. If the good is sufficiently rival, one of Olson's (1965) central propositions is restored: public goods will fail to be provided in large groups.

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  • Paul Pecorino & Akram Temimi, 2008. "The Group Size Paradox Revisited," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 10(5), pages 785-799, October.
    • Handle: RePEc:bla:jpbect:v:10:y:2008:i:5:p:785-799
    DOI: 10.1111/j.1467-9779.2008.00386.x
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    Cited by:

    1. Martin Kolmar & Hendrik Rommeswinkel, 2020. "Group size and group success in conflicts," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 55(4), pages 777-822, December.
    2. Thierry Pénard & Sylvain Dejean & Raphaël Suire, 2011. "Olson’s Paradox Revisited: An Empirical Analysis of Incentives to Contribute in P2P File-sharing Communities," Economics Working Paper Archive (University of Rennes & University of Caen) 201105, Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS.
    3. Pau Balart & Sabine Flamand & Orestis Troumpounis, 2016. "Strategic choice of sharing rules in collective contests," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 46(2), pages 239-262, February.
    4. Pau Balart & Sabine Flamand & Orestis Troumpounis, 2014. "Strategic choice of sharing rules in collective contests," Working Papers 64402108, Lancaster University Management School, Economics Department.
    5. Paul Pecorino & Akram Temimi, 2007. "Public good provision in a repeated game: The role of small fixed costs of participation," Public Choice, Springer, vol. 130(3), pages 337-346, March.
    6. Paul Pecorino, 2015. "Olson’s Logic of Collective Action at fifty," Public Choice, Springer, vol. 162(3), pages 243-262, March.
    7. Martin Kolmar & Andreas Wagener, 2010. "Inefficient Group Organization as Optimal Adaption to Dominant Environments," CESifo Working Paper Series 3157, CESifo.
    8. Tverskoi, Denis & Senthilnathan, Athmanathan & Gavrilets, Sergey, 2021. "The dynamics of cooperation, power, and inequality in a group-structured society," SocArXiv 24svr, Center for Open Science.
    9. Arye Hillman & Ngo Van Long, 2017. "The social cost of contestable benefits," CIRANO Working Papers 2017s-11, CIRANO.
    10. Arye L. Hillman & Ngo Van Long, 2017. "Rent Seeking: The Social Cost of Contestable Benefits," CESifo Working Paper Series 6462, CESifo.
    11. Paul Pecorino, 2009. "Public goods, group size, and the degree of rivalry," Public Choice, Springer, vol. 138(1), pages 161-169, January.
    12. Martin Kolmar & Hendrik Rommeswinkel, 2011. "Technological Determinants of the Group-Size Paradox," CESifo Working Paper Series 3362, CESifo.
    13. Kaplan, Jonathan D. & Howitt, Richard E. & Kroll, Stephan, 2012. "Private Provision of a Stochastic Common Property Resource," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124855, Agricultural and Applied Economics Association.
    14. Todd Sandler, 2015. "Collective action: fifty years later," Public Choice, Springer, vol. 164(3), pages 195-216, September.
    15. Noriaki Matsushima & Ryusuke Shinohara, 2015. "The efficiency of monopolistic provision of public goods through simultaneous bilateral bargaining," ISER Discussion Paper 0948, Institute of Social and Economic Research, Osaka University.
    16. Jiang, Luo-Luo & Gao, Jian & Chen, Zhi & Li, Wen-Jing & Kurths, Jürgen, 2021. "Reducing the bystander effect via decreasing group size to solve the collective-risk social dilemma," Applied Mathematics and Computation, Elsevier, vol. 410(C).
    17. Liu, Weifeng Larry & Sandler, Todd, 2024. "Public goods, group size, and provision aggregation," Journal of Economic Behavior & Organization, Elsevier, vol. 223(C), pages 146-167.
    18. Pau Balart & Sabine Flamand & Oliver Gürtler & Orestis Troumpounis, 2018. "Sequential choice of sharing rules in collective contests," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 20(5), pages 703-724, October.
    19. Valerio Capraro & Hélène Barcelo, 2015. "Group Size Effect on Cooperation in One-Shot Social Dilemmas II: Curvilinear Effect," PLOS ONE, Public Library of Science, vol. 10(7), pages 1-11, July.
    20. Martin Kolmar & Andreas Wagener, 2013. "Inefficiency As A Strategic Device In Group Contests Against Dominant Opponents," Economic Inquiry, Western Economic Association International, vol. 51(4), pages 2083-2095, October.
    21. Mercier, Jean-François, 2018. "Non-deterministic group contest with private information," Mathematical Social Sciences, Elsevier, vol. 95(C), pages 47-53.

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