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Coalitions and Networks in Industrial Organization
Author(s) -
Bloch Francis
Publication year - 2002
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/1467-9957.00282
Subject(s) - cartel , negotiation , yield (engineering) , economics , focus (optics) , industrial organization , political science , law , collusion , materials science , physics , optics , metallurgy
This paper provides a selective survey of recent approaches to coalition and network formation in industrial organization, and offers a unified framework in which the different approaches can be compared. We focus on two extreme forms of cooperation—collusive agreements and cost‐reducing alliances. We show that bilateral negotiations yield higher levels of cooperation than multilateral agreements, that the formation of a cartel depends on the sequentiality of the procedure of coalition formation, and that the size of alliances depends on the membership rule.