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The stability of group formation

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  • Gabrielle Demange

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique)

Abstract

In a large range of political and economic situations, the formation of coordinated groups is driven by two opposite forces: increasing returns to size on the one hand, the heterogeneity of preferences, which hampers coordination, on the other. An important question is whether competitive pressures, such as described by free mobility and free entry, lead to an efficient and stable organization of the society into possibly several self-sufficient groups. This paper discusses theoretical approaches to this question as well as recent empirical studies.

Suggested Citation

  • Gabrielle Demange, 2017. "The stability of group formation," Post-Print halshs-01884336, HAL.
    • Handle: RePEc:hal:journl:halshs-01884336
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    Cited by:

    1. Bos, Iwan & Marini, Marco A. & Saulle, Riccardo D., 2020. "Cartel formation with quality differentiation," Mathematical Social Sciences, Elsevier, vol. 106(C), pages 36-50.
    2. Demange, Gabrielle, 2024. "Stable outcomes in simple cooperative games," Journal of Mathematical Economics, Elsevier, vol. 111(C).
    3. Dmitry Levando, 2021. "Formation of coalition structures as a non-cooperative game," Papers 2107.00711, arXiv.org.

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