Between-group contests over group-specific public goods with within-group fragmentation

We model a contest between two groups of equal sized populations over the division of a group-specific public good. Each group is fragmented into subgroups. Each subgroup allocates effort between production and contestation. Perfect coordination is assumed within subgroups, but subgroups cannot coordinate with one another. All subgroups choose effort allocations simultaneously. We find that the group that is more internally fragmented receives the smaller share of the public good. Aggregate rent-seeking increases when the dominant subgroups within both communities have larger population shares. Any unilateral increase in fragmentation within a group reduces conflict and increases the total income of its opponent. Strikingly, the fragmenting community itself may, however, increase its total income as well, even though its share of the public good declines. Hence, a smaller share of public good provisioning cannot be used to infer a negative income effect on the losing community.