Title: Coalition Formation with Local Public Goods and Network Eect
Abstract: Many local public goods are provided by coalitions and they have network eects. Namely, people prefer to consume a public good in a coalition with more members. This paper adopts the Dreze and Greenberg (1980) type utility function where players have preferences over goods as well as coalition members. In a game with anonymous and separable network eects, the core is nonempty when coalition feasible sets are monotonic and players'preferences over public goods have strong connected support. All core allocations consist of connected coalitions and they are Tiebout equilibria as well. We also examine the no-exodus equilibrium for games whose feasible sets are not monotonic.
Publication Year: 2006
Publication Date: 2006-01-01
Language: en
Type: article
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Cited By Count: 1
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