Autore
Morelli, Massimo

Titolo
Internal Hierarchy and Stable Coalition Structures
Periodico
European University Institute of Badia Fiesolana (Fi). Department of Economics - Working papers
Anno: 2011 - Fascicolo: 20 - Pagina iniziale: 1 - Pagina finale: 36

When an agent decides whether to join a coalition or not, she must consider both i) the expected strength of the coalition and ii) her position in the vertical structure within the coalition. We establish that there exists a positive relationship between the degree of inequality in remuneration across ranks within coalitions and the number of coalitions to be formed. When coalition size is unrestricted, in all stable systems the endogenous coalitions must be mixed and balanced in terms of members' abilities, with no segregation. When coalitions must have a fixed finite size, stable systems display segregation by clusters while maintaining the aforesaid feature within clusters.




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