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SEQUENTIAL FORMATION OF COALITIONS
Category: Economic Theory
Industrial Organisaton: Mergers and Antitrust Sunday 25th August 2002, 09:30 - 11:00, Room: 1.4
Session Chair(s):
Giancarlo Spagnolo, University of Mannheim, GERMANY
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Abstract:
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We study a sequential protocol of endogenous coalition formation based on a process of bilateral agreements among the players. We apply the game to a Cournot environment with linear demand. We show that, contrary to other papers in the literature, the final outcome of any Markov Perfect Equilibrium of the game is the grand coalition, provided the initial number of firms is high enough and they sufficiently patient.
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Find this file in the \Papers\697\ folder of this CD-ROM.
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