The Alliance Formation Puzzle and Capacity Constraints
Kai A. Konrad
Max Planck Institute for Tax Law and Public Finance; Social Science Research Center Berlin (WZB); Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Institute for the Study of Labor (IZA)
Chapman University - Economic Science Institute; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)
February 1, 2008
WZB Markets and Politics Working Paper No. SP II 2008-07
The formation of an alliance in conflict situations is known to suffer from a collective action problem and from the potential of internal conflict. We show that budget constraints of an intermediate size can overcome this strong disadvantage and explain the formation of alliances.
Number of Pages in PDF File: 9working papers series
Date posted: August 26, 2010
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