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Endogenous Stackelberg leadership within a team. The coalition effect

Author

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  • Skarzhinskaya, E.

    (Kostroma State University, Kostroma, Russia)

  • Tsurikov, V.

    (Kostroma State Agricultural Academy, Kostroma, Russia)

Abstract

The article engages in a theoretical investigation of the possibility of implementing the Stackelberg strategy within a team. It is assumed that the team gene-rates aggregate income that increases as the efforts invested by each agent intensify, subject to the law of diminishing returns. The goal of each agent in a team is to maximize his own individual gain. In order to achieve an outcome that is Paretopreferable over Nash equilibrium, two approaches may be used: identifying a leader or forming a smaller group (coalition) within the team whose members, in pursuance of increased individual gains, choose the route that maximizes coalition gains. It is shown that the advent of a coalition in a team results in Pareto-improvement in a simultaneous game. We analyse the possibility of endogenous leadership forming according to the Stackelberg model when using the mechanism of timing decisions. It is established that under autonomy of all team members, leadership formation can only be confidently predicted in specific individual cases. In a significantly more general case, all of the prerequisites for the formation of leadership are created by the presence of a single coalition interested in implementing the Stackelberg strategy.

Suggested Citation

  • Skarzhinskaya, E. & Tsurikov, V., 2021. "Endogenous Stackelberg leadership within a team. The coalition effect," Journal of the New Economic Association, New Economic Association, vol. 49(1), pages 53-79.
  • Handle: RePEc:nea:journl:y:2021:i:49:p:53-79
    DOI: 10.31737/2221-2264-2021-49-1-2
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    Cited by:

    1. Skarzhinskaya, E. & Tzurikov, V., 2023. "The endogenous formation of leadership in collective actions using the modified timing decisions algorithm," Journal of the New Economic Association, New Economic Association, vol. 61(4), pages 51-68.

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    More about this item

    Keywords

    team; leader; coalition; Stackelberg equilibrium; Pareto-improvement;
    All these keywords.

    JEL classification:

    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

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