Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/63219 
Year of Publication: 
2005
Series/Report no.: 
Memorandum No. 2005,09
Publisher: 
University of Oslo, Department of Economics, Oslo
Abstract: 
To secure their membership in a popular group, individuals may contribute more to the group’s local public good than they would if group formation were exogenous. Those in the most unpopular group do not have this incentive to contribute to their group. Substantial differences in individual efforts levels between groups may be the result. A principal may prefer either exogenous or endogenous group formation, depending on whether an increase in contributions to the local public good coincides with the principal’s interests. We analyze two examples: Social interaction in schools, and multiple-task teamwork.
Subjects: 
Local public goods
opportunity costs
popularity
multiple-task principalagent analysis
JEL: 
C72
D11
D23
L24
Z13
Document Type: 
Working Paper

Files in This Item:
File
Size
316.87 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.