Endogenous Formation of Economic Coalitions: A Survey on the Partition Function Approach

THE ENDOGENOUS FORMATION OF ECONOMIC COALITIONS, Carlo Carraro, ed., Edward Elgar: London, 2003

57 Pages Posted: 7 Jan 2009

See all articles by Sang-Seung Yi

Sang-Seung Yi

Seoul National University - School of Economics

Date Written: June 7, 2003

Abstract

This paper surveys the recent literature on the endogenous formation of economic coalitions, in particular, the partition function literature that allows for externalities across coalitions. Various economic coalitions are classified either as coalitions with positive externalities (output cartels, R&D coalitions with spillovers, public-goods (environmental) coalitions, free-trade areas) or as coalitions with negative externalities (joint ventures with efficiency gains, customs unions). I review several games of coalition formation (the Single Coalition Formation game, the Open Membership game, the Exclusive Membership game, the Coalition Unanimity game, the Equilibrium Binding Agreements game) and examine equilibrium coalition structures in these games.

Keywords: coalition formation externalities partition function

JEL Classification: C72, C71

Suggested Citation

Yi, Sang-Seung, Endogenous Formation of Economic Coalitions: A Survey on the Partition Function Approach (June 7, 2003). THE ENDOGENOUS FORMATION OF ECONOMIC COALITIONS, Carlo Carraro, ed., Edward Elgar: London, 2003, Available at SSRN: https://ssrn.com/abstract=1324050

Sang-Seung Yi (Contact Author)

Seoul National University - School of Economics ( email )

San 56-1, Silim-dong, Kwanak-ku
Seoul 151-742
Korea

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