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Stable Alliance Formation in Distributional Conflict

Author

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  • Michelle R. Garfinkel

    (University of California at Irvine)

Abstract

This paper develops a positive analysis of alliance formation that builds on a simple economic model featuring a "winner-take-all" contest for control of some resource. When an alliance forms, members pool their efforts in that contest and,if successful, apply the resource to a joint production process. The analysis does not assume that the alliance has some special advantage in the conflict or that the joint production process exhibits increasing returns. Nor is there any presumption that peace prevails among the alliance members. In this setting, the analysis finds that, due to the familiar free-rider problem, the formation of alliances tends to reduce the severity of the conflict over the contestable resource. Furthermore, despite the internal conflict that arises among the winning alliance’s members over the distribution of their joint product, under reasonable conditions this effect alone is sufficient to support stable alliance formation in a noncooperative equilibrium.

Suggested Citation

  • Michelle R. Garfinkel, 2003. "Stable Alliance Formation in Distributional Conflict," Public Economics 0305001, University Library of Munich, Germany, revised 04 Mar 2004.
  • Handle: RePEc:wpa:wuwppe:0305001
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Conflict; endogenous alliance structure; resource allocation; free-rider problem.;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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