Between-group contests over group-specific public goods with within-group fragmentation / Indraneel Dasgupta (Indian Statistical Institute and IZA), Ranajoy Guha Neogi (Indian Statistical Institute) ; IZA Institute of Labor Economics
VerfasserDasgupta, Indraneel ; Neogi, Ranajoy Guha
KörperschaftForschungsinstitut zur Zukunft der Arbeit
ErschienenBonn, Germany : IZA Institute of Labor Economics, July 2017
Elektronische Ressource
Umfang1 Online-Ressource (18 Seiten)
SerieDiscussion paper ; no. 10881
 Das Dokument ist öffentlich zugänglich im Rahmen des deutschen Urheberrechts.
Between-group contests over group-specific public goods with within-group fragmentation [0.51 mb]
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We model a contest between two groups of equal population size over the division of a group-specific public good. Each group is fragmented into sub-groups. Each sub-group allocates effort between production and contestation. There is perfect coordination within sub-groups, but sub-groups cannot coordinate with one another. All sub-groups choose effort allocations simultaneously. We find that aggregate rent-seeking rises, social welfare falls, and both communities are worse off when the dominant sub-groups within both communities increase their population shares relative to the respective average sub-group population. Any unilateral increase in fragmentation within a group reduces conflict and makes its opponent better off. The fragmenting community itself may however be better off as well, even though its share of the public good falls. Thus, a reduced share of public good provisioning cannot be used to infer a negative welfare implication for the losing community.