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The Stability Of Anarchy And Breakdown Of Production

  • Kjell Hausken

In Hirshleifer's (1995) model for unitary actors, combined fighting/production abruptly breaks down when inter-group decisiveness of fighting is above a certain value (above one) or income requirements are not met. Accounting for the collective action problem, this article gives the opposite result that fighting/production is stable also for large decisiveness parameters (above one) and strict income requirements for each agent. The stable fighting/production equilibrium gets gradually easier to perturb off balance for high inter-group decisiveness, high costs of fighting, different fighting efficiencies, and equal group sizes. The equilibrium number of groups that can be sustained decreases in the inter-group decisiveness and increases in the cost of fighting.

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Article provided by Taylor & Francis Journals in its journal Defence and Peace Economics.

Volume (Year): 17 (2006)
Issue (Month): 6 ()
Pages: 589-603

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Handle: RePEc:taf:defpea:v:17:y:2006:i:6:p:589-603
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  1. Glenn W. Harrison & Jack Hirshleifer, 1988. "An Experimental Evaluation of Weakest-Link/Best Shot Models of Public Goods," UCLA Economics Working Papers 473, UCLA Department of Economics.
  2. Hausken, Kjell, 2000. "Cooperation and between-group competition," Journal of Economic Behavior & Organization, Elsevier, vol. 42(3), pages 417-425, July.
  3. Hausken, Kjell, 2000. "Migration and intergroup conflict," Economics Letters, Elsevier, vol. 69(3), pages 327-331, December.
  4. Herschel I. Grossman, 1999. "Producers and Predators," NBER Working Papers 6499, National Bureau of Economic Research, Inc.
  5. Skaperdas, Stergios & Syropoulos, Constantinos, 1997. "The Distribution of Income in the Presence of Appropriative Activities," Economica, London School of Economics and Political Science, vol. 64(253), pages 101-17, February.
  6. Kjell Hausken, 2005. "Production and Conflict Models Versus Rent-Seeking Models," Public Choice, Springer, vol. 123(1), pages 59-93, April.
  7. Hirshleifer, Jack, 1991. "The Technology of Conflict as an Economic Activity," American Economic Review, American Economic Association, vol. 81(2), pages 130-34, May.
  8. Stergios Skaperdas, 1996. "Contest success functions (*)," Economic Theory, Springer, vol. 7(2), pages 283-290.
  9. Katz, Eliakim & Nitzan, Shmuel & Rosenberg, Jacob, 1990. " Rent-Seeking for Pure Public Goods," Public Choice, Springer, vol. 65(1), pages 49-60, April.
  10. Nitzan, Shmuel, 1994. "Modelling rent-seeking contests," European Journal of Political Economy, Elsevier, vol. 10(1), pages 41-60, May.
  11. Nitzan, Shmuel, 1991. "Collective Rent Dissipation," Economic Journal, Royal Economic Society, vol. 101(409), pages 1522-34, November.
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