Heterogeneity gap in stable juridiction structures

Bogomolnaia, Anna;Le Breton, Michel;Savvateev, Alexei;Weber, Shlomo
(2006)

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Authors
  • Bogomolnaia, Anna
    Author
  • Le Breton, Michel
    Author
  • Savvateev, Alexei
    Author
  • Weber, ShlomoUCLouvain
    Author
Abstract
This paper examines a model of multi-jurisdiction formation where individuals' characteristics are uniformly distributed over a finite interval. Every jurisdiction locates a public facility and distributes its cost equally among the residents. We consider two notions of stability: Nash stability and its refinement local Nash stability, and examine the existence and characterization of stable partitions. The main feature of this analysis is that, even under the uniform distribution, there are stable structures that exhibit a high degree of heterogeneity of jurisdiction sizes.
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Bogomolnaia, A., Le Breton, M., Savvateev, A., & Weber, S. (2006). Heterogeneity gap in stable juridiction structures (ECON Working Papers 2006/19). https://hdl.handle.net/2078.5/66738