Endogenous Group Formation

30 Pages Posted: 3 Feb 2005

See all articles by Tim Salmon

Tim Salmon

Southern Methodist University

R. Mark Isaac

Florida State University - Department of Economics

T. K. Ahn

Florida State University - Department of Political Science

Date Written: December 2004

Abstract

While the rules governing the formation of groups engaging in collective action may have significant impact on group size and behavior of members, most experiments on public goods have been conducted with the subjects in fixed groups or of fixed sizes. We study endogenous formation of groups in a public-goods provision game by allowing subjects to change groups under three sets of rules: free entry and exit, restricted entry and free exit, and free entry and restricted exit. We find that the rules governing entry and exit do have a significant impact on individual behavior and group-level outcomes.

Keywords: Public Goods, Group Formation, Social Networks

JEL Classification: C92, H41, D85

Suggested Citation

Salmon, Tim and Isaac, Robert Mark and Ahn, T. K., Endogenous Group Formation (December 2004). FSU College of Law, Law and Economics Paper No. 05-11. Available at SSRN: https://ssrn.com/abstract=660563 or http://dx.doi.org/10.2139/ssrn.660563

Tim Salmon (Contact Author)

Southern Methodist University ( email )

6212 Bishop Blvd.
Dallas, TX 75275
United States

HOME PAGE: http://faculty.smu.edu/tsalmon/

Robert Mark Isaac

Florida State University - Department of Economics ( email )

425 W. Jefferson Street
Tallahassee, FL 32306
United States
850-644-7081 (Phone)
850-644-4535 (Fax)

T. K. Ahn

Florida State University - Department of Political Science ( email )

Talahasse, FL 30306
United States
850-644-4540 (Phone)
850-644-4535 (Fax)

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