Majority Rule and Coalitional Stability

Sergio Currarini () and Marco Marini

Economics Bulletin, 2013, vol. 33, issue 3, 1660-1668

Abstract: In this note we study the centralization vs. decentralization issue for the management of a given collective activity. The aim is to characterize a class of decision rules that guarantees the stability of global cooperation (i.e centralization) against the incentive of coalitions of citizens to opt-out, towards forms of decentralized organizations. We show that a simple majority rule required to break global cooperation guarantees the existence of core-stable allocations, independently of the expected behaviour of individuals in the minority. We also show that if majorities can extract resources from minorities, stability may require a supermajority rule, whose threshold is increasing in its extraction power.

Keywords: Majority Rule; Supermajority; Externalities; Core. (search for similar items in EconPapers)
JEL-codes: C7 D7 (search for similar items in EconPapers)
Date: 2013-07-03
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