Endogenous formation of economic coalitions: a survey of the partition function approach

Yi, Sang-Seung

doi:10.4337/9781781009888.00011

Cited by 49 publications

(51 citation statements)

References 39 publications

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“…There are several stability concepts that can be used and which unfortunately provide different equilibrium coalition structures. Among them, let us recall the concept of equilibrium binding agreements proposed by Ray and Vohra (1996), the concepts of α-stability and β-stability proposed in Hart and Kurz (1983), the sequential stability concept of Bloch (1994), the open-membership stability proposed by Yi and Shin (1994) and the farsighted stability concept used in Chew (1994), Mariotti (1997).…”

Section: A More General Coalition Structurementioning

confidence: 99%

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The structure of international environmental agreements

Carraro¹

1999

International Environmental Agreements on Climate Change

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may AbstractSince the framework convention of Rio, actual environmental negotiations on climate change aim at inducing all world countries to sign a global environmental agreements to reduce greenhouse gas emissions. Despite the past unsuccessful attempts, even current negotiations seem to pursue the same objective. This paper shows from a game-theoretic viewpoint that the emergence of agreements signed by all countries is quite unlikely, even in the presence of appropriate and multi-issues negotiation strategies and transfers. Either a single partial agreement or a coalition structure in which regional environmental agreements to control climate change are signed are the most likely outcomes. The paper compares these two cases and argue that regional agreements may increase both countries welfare and environmental quality.

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Section: A More General Coalition Structurementioning

confidence: 99%

“…On the other hand, there are diminishing returns of R&D cooperation. This implies that it may be optimal to exclude some countries from the joint R&D and environmental cooperation (the so-called exclusive membership stability of Yi and Shin, 1994).…”

Section: Issue Linkagementioning

confidence: 99%

The structure of international environmental agreements

Carraro¹

1999

International Environmental Agreements on Climate Change

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“…Our assumption is in line with the mainstream of the literature on coalition theory. For an overview see Bloch (2003) and Yi (2003).…”

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confidence: 99%

Optimal transfers and participation decisions in international environmental agreements

2006

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“…The equilibrium in the second stage is a non-cooperative Nash equilibrium and each firm's strategy space is [to sign the VA, not sign the VA]. Decisions are simultaneous and the membership rule is open (see Carraro and Marchiori, 2003;Yi, 2003 for a detailed description of these assumptions and their implications). In the third stage -the Cournot game -the n firms choose their output and optimal abatement levels simultaneously and non cooperatively (with or without the constraint on minimum abatement levels imposed by the regulator).…”

Section: The Modelmentioning

confidence: 99%

“…However, the literature on international environmental agreements (IEAs) on global commons has shown that even in those cases where a good is purely public, a number of agentsin this literature sovereign countries -may decide to pay the cost of providing the public good (technically, they form a coalition within which the burden of providing the public good is shared). 3 If the public good is imperfect, then the coalition size usually increases (Yi, 1997(Yi, , 2003Carraro and Siniscalco, 1997). It is therefore important to assess whether these results also apply to the case of VAs, and above all under what conditions a 'coalitional VA' emerges, i.e.…”

Section: Introductionmentioning

confidence: 99%

The design of voluntary agreements in oligopolistic markets

Brau

Carraro

2010

J Regul Econ

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This paper analyses the conditions under which a group of firms have the incentive to sign a voluntary agreement (VA) to control polluting emissions even in the presence of free-riding by other firms in the industry. We consider a policy framework in which firms in a given industry decide whether or not to sign a VA proposed by an environmental regulator. We identify the features that a VA should possess in order to provide firms with an incentive to participate in the VA and to enhance its economic and environmental effectiveness. Under very general conditions on the shape of the demand schedule, we obtain the following results. First, a VA does not belong to the equilibrium of the coalition game when benefits from voluntary emission abatement are a pure public good, unless an industry emission target is set by the regulator. Second, in the presence of partial spillovers-i.e. when signatories obtain more benefits from the VA than non-signatories-a VA can belong to the equilibrium only if a minimum participation rule is guaranteed. Third, a VA with a minimum participation rule and a minimum mandatory emission abatement may improve welfare (and even industry profits) compared to a VA in which firms are free to set their own profit maximizing abatement level

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Endogenous formation of economic coalitions: a survey of the partition function approach

Cited by 49 publications

References 39 publications

The structure of international environmental agreements

The structure of international environmental agreements

Optimal transfers and participation decisions in international environmental agreements

The design of voluntary agreements in oligopolistic markets

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