Skip to main content Accessibility help

We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.

Close cookie message
×
Hostname: page-component-6bf8c574d5-9nwgx Total loading time: 0 Render date: 2025-02-14T10:32:38.967Z Has data issue: false hasContentIssue false

Part IV - Club Theory

Published online by Cambridge University Press:  12 October 2017

Edited by
Stephen M. Maurer
Stephen M. Maurer
Affiliation:
University of California, Berkeley
Get access

Summary

A partnership is a coalition that divides its output equally. We show that when partnerships can form freely, a stable or “core” partition into partnerships always exists and is generically unique. When people differ in ability, the equal-sharing constraint inefficiently limits the size of partnerships. We give conditions under which partnerships containing abler people will be larger, and show that if the population is replicated, partnerships may become more or less homogeneous, depending on an elasticity condition. We also examine when the equal-sharing inefficiency vanishes in the limit.

Type
Chapter
Information
On the Shoulders of Giants
Colleagues Remember Suzanne Scotchmer's Contributions to Economics
 , pp. 230 - 262
Publisher: Cambridge University Press
Print publication year: 2017

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

References

Flood, John, The Legal Profession in the United States (Chicago, IL: The American Bar Foundation, 1985).Google Scholar
Greenberg, Joseph, “Stable Standards of Behavior: A Unifying Approach to Solution Concepts,” IMSSS Technical Report No. 484, Stanford University, Dept. of Economics, March 1986.Google Scholar
Greenberg, Joseph, and Weber, Shlomo, “Strong Tiebout Equilibrium under Restricted Preferences Domain,” Journal of Economic Theory, XXXVIII [1986], 101–17.Google Scholar
Guesnerie, Roger, and Oddou, Claude, “Second Best Taxation as a Game,” Journal of Economic Theory, XXV [1981], 67–91.CrossRefGoogle Scholar
Holmstrom, Bengt, “Moral Hazard in Teams,” Bell Journal of Economics, XIII [1982], 324–40.Google Scholar
Pauly, Mark, “Cores and Clubs,” Public Choice, IX [1970], 53–65.CrossRefGoogle Scholar
Schelling, Thomas, Micromotives and Macrobehavior (New York, NY: Norton, 1978).Google Scholar
Selten, Reinhard, “Equal Share Analysis of Characteristic Function Experiments,” Tubingen, Contributions to Experimental Economics, III [1972].Google Scholar
Sorenson, J., Tschirhart, J., and Whinston, W., “A Theory of Pricing under Decreasing Costs,” American Economic Review, LXVIII [1978a], 614–24.Google Scholar
Sorenson, J., Tschirhart, J., and Whinston, W., “Private Good Clubs and the Core,” Journal of Public Economics 10 [1978b], 77–95.CrossRefGoogle Scholar
Spulber, Daniel, “Second-best Pricing and Cooperation,” RAND Journal of Economics, XVII [1986], 239–50.Google Scholar
Thomson, William, and Varian, Hal, “Theories of Justice Based on Symmetry,” in Social Goals and Social Organizations: Essays in Memory of Elisha Pazner, Hurwicz, L., Schmeidler, D., and Sonnenschein, H., eds. (Cambridge: Cambridge University Press, 1985), Chapter 4.Google Scholar
Zachau, Ulrich, “Who Cooperates with Whom?” mimeograph, Nuffield College, Oxford, 1987.Google Scholar

References

ARROW, K. (1972). “Models of Job Discrimination,” in Racial Discrimination in Economic Life, ed. by Pascal, A. H.. Lexington, MA: D. C. Heath.Google Scholar
AUMANN, R. (1964): “Markets with a Continuum of Traders,” Econometrica, 32, 39–50.CrossRefGoogle Scholar
BECKER, G. (1957): The Economics of Discrimination. Chicago: University of Chicago Press.Google Scholar
BUCHANAN, J. (1965): “An Economic Theory of Clubs,” Economica, 32, 1–14.CrossRefGoogle Scholar
COLE, H., AND PRESCOTT, E. (1997): “Valuation Equilibrium with Clubs,” Journal of Economic Theory, 74, 19–39.CrossRefGoogle Scholar
CONLEY, J. P., AND WOODERS, M. (1995): “Equivalence of the Core and Competitive Equilibrium in a Tiebout Economy with Crowding Types,” Department of Economics, University of Illinois, Champaign.Google Scholar
CORNES, R., AND SANDLER, T. (1996): The Theory of Externalities, Public Goods and Club Goods. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
ELLICKSON, B. (1973): “A Generalization of the Pure Theory of Public Goods,” American Economic Review, 63, 417–432.Google Scholar
ELLICKSON, B. (1979):“Competitive Equilibrium with Local Public Goods,” Journal of Economic Theory, 21, 46–61.CrossRefGoogle Scholar
ELLICKSON, B., GRODAL, B., SCOTCHMER, S., AND ZAME, W. (1997a): “Clubs and the Market: Continuum Economies,” UCLA Working Paper.Google Scholar
ELLICKSON, B., GRODAL, B., SCOTCHMER, S., AND ZAME, W. (1997b): “Clubs and the Market: Large Finite Economies,” UCLA Working Paper.Google Scholar
GILLES, R. P., and SCOTCHMER, S. (1997): “Decentralization in Replicated Club Economies with Multiple Private Goods,” Journal of Economic Theory, 72, 363–387.CrossRefGoogle Scholar
HILDENBRAND, W. (1974): Core and Equilibria of a Large Economy. Princeton: Princeton University Press.Google Scholar
KURZ, M. (1997): “Game Theory and Public Economics,” in Handbook of Game Theory, Vol. II, ed. by Aumann, R. and Hart, S.. Amsterdam: Elsevier North-Holland, 1153–1192.Google Scholar
MAKOWSKI, L. (1978): “A Competitive Theory of Organizations,” Mimeograph.Google Scholar
MAS-COLELL, A. (1975): “A Model of Equilibrium with Differentiated Commodities,” Journal of Mathematical Economics, 2, 263–295.CrossRefGoogle Scholar
MAS-COLELL, A. (1977): “Indivisible Commodities and General Equilibrium Theory,” Journal of Economic Theory, 16, 433–456.CrossRefGoogle Scholar
MAS-COLELL, A. (1980): “Efficiency and Decentralization in the Pure Theory of Public Goods,” Quarterly Journal of Economics, 94, 625–641.CrossRefGoogle Scholar
MAS-COLELL, A. (1985): The Theory of General Equilibrium: A Differentiable Approach. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
OSTROY, J., AND ZAME, W. R. (1994): “Non-atomic Economies and the Boundaries of Perfect Competition,” Econometrica, 62, 593–633.CrossRefGoogle Scholar
SCHMEIDLER, D. (1969): “Competitive Equilibria in Markets with a Continuum of Traders and Incomplete Preferences,” Econometrica, 37, 578–585.CrossRefGoogle Scholar
SCOTCHMER, S. (1997): “On Price-Taking Equilibrium in Club Economies with Nonanonymous Crowding,” Journal of Public Economics, 65, 75–88.CrossRefGoogle Scholar
SCOTCHMER, S., AND WOODERS, M. (1987): “Competitive Equilibrium and the Core in Club Economies with Anonymous Crowding,” Journal of Public Economics, 34, 159–174.CrossRefGoogle Scholar
TIEBOUT, C. M. (1956): “A Pure Theory of Local Public Goods,” Journal of Political Economy, 64, 416–424.CrossRefGoogle Scholar
VIND, K. (1964): “Edgeworth Allocations in an Exchange Economy with Many Traders,” International Economic Review, 5:165–177.CrossRefGoogle Scholar

Save book to Kindle

To save this book to your Kindle, first ensure no-reply@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

  • Club Theory
  • Edited by Stephen M. Maurer, University of California, Berkeley
  • Book: On the Shoulders of Giants
  • Online publication: 12 October 2017
Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

  • Club Theory
  • Edited by Stephen M. Maurer, University of California, Berkeley
  • Book: On the Shoulders of Giants
  • Online publication: 12 October 2017
Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

  • Club Theory
  • Edited by Stephen M. Maurer, University of California, Berkeley
  • Book: On the Shoulders of Giants
  • Online publication: 12 October 2017
Available formats
×