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| Sergio Currarini and Marco A. Marini |
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| ''Majority Rule and Coalitional Stability'' |
| ( 2013, Vol. 33 No.3 ) |
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| 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. |
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| Keywords: Majority Rule, Supermajority, Externalities, Core. |
JEL:
D7 - Analysis of Collective Decision-Making: General |
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| Manuscript Received : Jun 01 2013 | | Manuscript Accepted : Jul 03 2013 |
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