Public Good Agreements under the Weakest-link Technology

Alejandro Caparros, Michael Finus

Research output: Working paper

Abstract

We analyze the formation of public good agreements under the weakest-link technol-ogy. Cooperation on migration policies, money laundering measures and biodiversityconservation e§orts are prime examples of this technology. Whereas for symmetricplayers, policy coordination is not necessary, for asymmetric players cooperation mat-ters but fails, in the absence of transfers. In contrast, with an optimal transfer scheme,asymmetry may not be an obstacle but an asset for cooperation. Counterintuitively, avery skewed distribution of interests may allow even the grand coalition being stable.We characterize various types and degrees of asymmetry and relate them to the stabil-ity of agreements and associate gains from cooperation. We compare our results withthose obtained under the well-known summation technology and demonstrate that theycan be derived under much more general conditions.
LanguageEnglish
Place of PublicationBath, U. K.
PublisherDepartment of Economics, University of Bath
StatusPublished - 2016

Publication series

NameBath Economics Research Working Papers
Volume52/16

Fingerprint

Weak links
Asymmetry
Assets
Policy coordination
Migration policy
Skewed distribution

Cite this

Caparros, A., & Finus, M. (2016). Public Good Agreements under the Weakest-link Technology. (Bath Economics Research Working Papers; Vol. 52/16). Bath, U. K.: Department of Economics, University of Bath.

Public Good Agreements under the Weakest-link Technology. / Caparros, Alejandro; Finus, Michael.

Bath, U. K. : Department of Economics, University of Bath, 2016. (Bath Economics Research Working Papers; Vol. 52/16).

Research output: Working paper

Caparros, A & Finus, M 2016 'Public Good Agreements under the Weakest-link Technology' Bath Economics Research Working Papers, vol. 52/16, Department of Economics, University of Bath, Bath, U. K.
Caparros A, Finus M. Public Good Agreements under the Weakest-link Technology. Bath, U. K.: Department of Economics, University of Bath. 2016. (Bath Economics Research Working Papers).
Caparros, Alejandro ; Finus, Michael. / Public Good Agreements under the Weakest-link Technology. Bath, U. K. : Department of Economics, University of Bath, 2016. (Bath Economics Research Working Papers).
@techreport{de2ccf68f7ce4d5385b85cd3ba94aee0,
title = "Public Good Agreements under the Weakest-link Technology",
abstract = "We analyze the formation of public good agreements under the weakest-link technol-ogy. Cooperation on migration policies, money laundering measures and biodiversityconservation e§orts are prime examples of this technology. Whereas for symmetricplayers, policy coordination is not necessary, for asymmetric players cooperation mat-ters but fails, in the absence of transfers. In contrast, with an optimal transfer scheme,asymmetry may not be an obstacle but an asset for cooperation. Counterintuitively, avery skewed distribution of interests may allow even the grand coalition being stable.We characterize various types and degrees of asymmetry and relate them to the stabil-ity of agreements and associate gains from cooperation. We compare our results withthose obtained under the well-known summation technology and demonstrate that theycan be derived under much more general conditions.",
author = "Alejandro Caparros and Michael Finus",
note = "Working paper no. 52/16",
year = "2016",
language = "English",
series = "Bath Economics Research Working Papers",
publisher = "Department of Economics, University of Bath",
type = "WorkingPaper",
institution = "Department of Economics, University of Bath",

}

TY - UNPB

T1 - Public Good Agreements under the Weakest-link Technology

AU - Caparros, Alejandro

AU - Finus, Michael

N1 - Working paper no. 52/16

PY - 2016

Y1 - 2016

N2 - We analyze the formation of public good agreements under the weakest-link technol-ogy. Cooperation on migration policies, money laundering measures and biodiversityconservation e§orts are prime examples of this technology. Whereas for symmetricplayers, policy coordination is not necessary, for asymmetric players cooperation mat-ters but fails, in the absence of transfers. In contrast, with an optimal transfer scheme,asymmetry may not be an obstacle but an asset for cooperation. Counterintuitively, avery skewed distribution of interests may allow even the grand coalition being stable.We characterize various types and degrees of asymmetry and relate them to the stabil-ity of agreements and associate gains from cooperation. We compare our results withthose obtained under the well-known summation technology and demonstrate that theycan be derived under much more general conditions.

AB - We analyze the formation of public good agreements under the weakest-link technol-ogy. Cooperation on migration policies, money laundering measures and biodiversityconservation e§orts are prime examples of this technology. Whereas for symmetricplayers, policy coordination is not necessary, for asymmetric players cooperation mat-ters but fails, in the absence of transfers. In contrast, with an optimal transfer scheme,asymmetry may not be an obstacle but an asset for cooperation. Counterintuitively, avery skewed distribution of interests may allow even the grand coalition being stable.We characterize various types and degrees of asymmetry and relate them to the stabil-ity of agreements and associate gains from cooperation. We compare our results withthose obtained under the well-known summation technology and demonstrate that theycan be derived under much more general conditions.

M3 - Working paper

T3 - Bath Economics Research Working Papers

BT - Public Good Agreements under the Weakest-link Technology

PB - Department of Economics, University of Bath

CY - Bath, U. K.

ER -

Access to Document