Stable Coalitions

47 Pages Posted: 11 Apr 2002

See all articles by Carlo Carraro

Carlo Carraro

Ca' Foscari University of Venice; CMCC - Euro Mediterranean Centre for Climate Change (Climate Policy Division); IPCC; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Centre for European Policy Studies, Brussels; Green Growth Knowledge Platform

Carmen Marchiori

Fondazione Eni Enrico Mattei (FEEM); University College London

Multiple version iconThere are 2 versions of this paper

Date Written: March 2002

Abstract

This Paper examines recent theoretical developments in the theory of coalition stability. It focuses on the relationship between the incentives to defect from a coalition, the size of the resulting equilibrium coalition structure and the different assumptions on membership rules, coalition behaviour, players' conjectures, etc. The Paper considers several cases. Simultaneous versus sequential moves, linear versus circular order of moves, Nash versus rational conjectures, open versus exclusive membership, monotonic versus non-monotonic payoff functions and orthogonal versus non-orthogonal reaction functions. The profitable and stable coalition will be derived for each possible configuration of the rules of the game, the pay-off functions and the membership rules. The results show that the size of the profitable and stable coalition highly depends on the chosen configuration and that the equilibrium outcome ranges from a small coalition with a few signatories to full cooperation. The Paper explores under which conditions a large stable coalition is likely to emerge, and identifies the institutional setting that favours the emergence of such coalition.

Keywords: Agreements, coaltions, incentives, negotiations, stability

JEL Classification: H00, H20, H30

Suggested Citation

Carraro, Carlo and Marchiori, Carmen, Stable Coalitions (March 2002). Available at SSRN: https://ssrn.com/abstract=306827

Carlo Carraro (Contact Author)

Ca' Foscari University of Venice ( email )

Cannaregio 873
Venice, 30121
Italy
+39 04 1234 9166 (Phone)
+39 04 1234 9176 (Fax)

HOME PAGE: http://www.carlocarraro.org/

CMCC - Euro Mediterranean Centre for Climate Change (Climate Policy Division) ( email )

Via Augusto Imperatore 16
Lecce, 73100
Italy
+39 0832 288650 (Phone)
+39 0832 277603 (Fax)

IPCC ( email )

C/O World Meteorological Organization
7bis Avenue de la Paix
Geneva, CH-1211
Switzerland
+41-22-730-8208/54/84 (Phone)
+41-22-730-8025/13 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Centre for European Policy Studies, Brussels

1 Place du Congres
B-1000 Brussels, 1000
Belgium
+32 2 229 3911 (Phone)
+32 2 219 4151 (Fax)

Green Growth Knowledge Platform ( email )

International Environment House
11-13 chemin des Anemones
Geneva, 1219
Switzerland

HOME PAGE: http://www.greengrowthknowledge.org/

Carmen Marchiori

Fondazione Eni Enrico Mattei (FEEM) ( email )

Campo S. M. Formosa, Castello 5252
Venezia, 30122
Italy
+39 041 271 1453 (Phone)
+39 041 271 1461 (Fax)

University College London

Gower Street
London
United Kingdom

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
23
Abstract Views
2,157
PlumX Metrics