Optimal Constitutional Response to Coalition Formation

Jean‐Jacques Laffont

in Incentives and Political Economy

Published in print October 2001 | ISBN: 9780199248681
Published online November 2003 | e-ISBN: 9780191596575 | DOI:

Series: Clarendon Lectures in Economics

 Optimal Constitutional Response to Coalition Formation

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This chapter studies horizontal collusion between interest groups in a Bayesian setting. Various models under complete and incomplete information are introduced and the different results are obtained as a function of the correlation of private information. The role of transaction costs within the coalition is found to be of crucial importance and a number of unresolved issues are outlined for future research.

Keywords: Bayesian; coalition; horizontal collusion; incomplete information; interest groups; private information; transaction costs

Chapter.  10813 words.  Illustrated.

Subjects: Microeconomics

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