Tinbergen Institute Discussion Paper No. TI 2018-083/VIII
We examine the role of support for coalition stability in common pool resource games such as fisheries games. Some players may not want to join a coalition that jointly manages a resource. Still, because they benefit from spillovers, they may want to support the coalition with a transfer payment in order to set incentives for others to join. We find that the impact of support on equilibria of this game is limited to games with three or five players.
Cartel games Coalition formation Common Pool Resources Support