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The Number of Organizations in Heterogeneous Societies

Author

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  • Lind, Jo Thori

    (Dept. of Economics, University of Oslo)

Abstract

I consider a society with heterogeneous individuals who can form organizations for the production of a differentiated service. An arrangement of organizations is said to be split up stable when there is no majority to split any of the organizations. Unlike other equilibrium concepts in the literature, the largest number of organizations that is split up stable corresponds to the socially optimal number of organizations, with a possibility of over provision of one organization. The analysis is extended to a case with endogeneous membership, where it is shown that the results remain the same.

Suggested Citation

  • Lind, Jo Thori, 2010. "The Number of Organizations in Heterogeneous Societies," Memorandum 08/2010, Oslo University, Department of Economics.
    • Handle: RePEc:hhs:osloec:2010_008
    as

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    File URL: https://www.sv.uio.no/econ/english/research/unpublished-works/working-papers/pdf-files/2010/Memo-08-2010.pdf
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    References listed on IDEAS

    as
    1. LE BRETON, Michel & WEBER, Shlomo & DREZE, Jacques H., 2005. "Secession-proofness in large heterogeneous societies," LIDAM Reprints CORE 1976, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Michel Le Breton & Shlomo Weber, 2003. "The Art of Making Everybody Happy: How to Prevent a Secession," IMF Staff Papers, Palgrave Macmillan, vol. 50(3), pages 1-4.
    3. Alexei Savvateev & Michel Le Breton & Valery Makarov & Shlomo Weber, 2008. "Multiple Membership and Federal Sructures," Working Papers 2008.41, Fondazione Eni Enrico Mattei.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Organizations; public goods; split up stability; efficiency; endogneous membership;
    All these keywords.

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H49 - Public Economics - - Publicly Provided Goods - - - Other
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

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