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A Note on Stable Cartels

Author

Listed:
  • Mao, Liang

Abstract

In non-cooperative open membership cartel formation games, it is usually assumed that cartel members will maximize their joint payoffs. Through an example, this note shows that this assumption is problematic, because it imposes some unnecessary restrictions on cartel members' actions. We recommend that the cartel agreement should be endogenously determined in future studies.

Suggested Citation

  • Mao, Liang, 2017. "A Note on Stable Cartels," MPRA Paper 83982, University Library of Munich, Germany, revised 18 Jan 2018.
    • Handle: RePEc:pra:mprapa:83982
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    References listed on IDEAS

    as
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    6. Köke, Sonja & Lange, Andreas, 2017. "Negotiating environmental agreements under ratification constraints," Journal of Environmental Economics and Management, Elsevier, vol. 83(C), pages 90-106.
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    8. Francis Bloch, 2003. "Non-cooperative models of coalition formation in games with spillovers," Chapters, in: Carlo Carraro (ed.), The Endogenous Formation of Economic Coalitions, chapter 2, Edward Elgar Publishing.
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    10. Mao, Liang, 2017. "Designing International Environmental Agreements under Participation Uncertainty," MPRA Paper 86248, University Library of Munich, Germany.
    11. Michael L. Katz, 1986. "An Analysis of Cooperative Research and Development," RAND Journal of Economics, The RAND Corporation, vol. 17(4), pages 527-543, Winter.
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    JEL classification:

    • C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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