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Stable Partitions in a Model with Group-Dependent Feasible Sets

Author

Listed:
  • Michel Le Breton

    (Université de Toulouse I)

  • Shlomo Weber

    (Department of Economics, Southern Methodist University)

Abstract

In this paper we consider a model of group formation where group of individuals may have different feasible sets. We focus on two polar cases, increasing returns, when the set of feasible alternatives increases if a new member joins thegroup, and decreasing returns, when a new member has an opposite effect and reduces the number of alternatives available for the enlarged group. We consider two notions, stability and strong stability of group structures, that correspond to Nash and Strong Nash equilibrium of the associated non-cooperative game. We prove existence results for various classes of environments and also investigate the link between the dimensionality of the set of alternatives and the existence of stable structures.

Suggested Citation

  • Michel Le Breton & Shlomo Weber, "undated". "Stable Partitions in a Model with Group-Dependent Feasible Sets," Discussion Papers 03-24, University of Copenhagen. Department of Economics, revised May 2003.
  • Handle: RePEc:kud:kuiedp:0324
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    File URL: http://www.econ.ku.dk/english/research/publications/wp/2003/0324.pdf/
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    References listed on IDEAS

    as
    1. Le Breton, M & Owen, G & Weber, S, 1992. "Strongly Balanced Cooperative Games," International Journal of Game Theory, Springer;Game Theory Society, vol. 20(4), pages 419-427.
    2. Breton, M. le & Weber, S., 1992. "Stability of Coalition Structures and the Principle of Optimal Partitioning," Papers 93-6, York (Canada) - Department of Economics.
    3. Moulin, Herve, 1994. "Social choice," Handbook of Game Theory with Economic Applications,in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 2, chapter 31, pages 1091-1125 Elsevier.
    4. Maurice Salles, 2005. "Social Choice," Post-Print halshs-00337075, HAL.
    5. Le Breton, M, 1989. "A Note on Balancedness and Nonemptiness of the Core in Voting Games," International Journal of Game Theory, Springer;Game Theory Society, vol. 18(1), pages 111-117.
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    More about this item

    Keywords

    feasible sets; stable partitions; positive externality; increasing and decreasing returns;

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations

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