Too big to prevail: The paradox of power in coalition formation

Arbeitspapier

In standard coalition games, players try to form a coalition to secure a prize and a coalition agreement specifies how the prize is to be split among its members. However, in practical situations where coalitions are formed, the actual split of the prize often takes place after the coalition formation stage. This creates the possibility for some players to ask for a renegotiation of the initial split. We predict that, in such situations, a player can suffer from being "too strong". Our experimental results confirm that, when the actual split of the prize is delayed, a player's strength can turn into a strategic disadvantage: a greater voting power in forming a winning coalition is undermined by the threat of being overly powerful at the stage when a split is determined. This result is relevant to many real world situations where "too strong" players find it paradoxically hard to partner with weaker players to win the game.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Papers in Economics and Statistics ; No. 2021-09

Classification and Topics

• Classification: Wirtschaft ; Cooperative Games ; Design of Experiments: Laboratory, Group Behavior ; Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior ; Conflict; Conflict Resolution; Alliances; Revolutions
• Subject: Shapley Value ; (Non) Binding Agreement ; Balance of Power ; Communication

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ke, Changxia ; Morath, Florian ; Newell, Anthony ; Page, Lionel
• Event: Veröffentlichung
• (who): University of Innsbruck, Research Platform Empirical and Experimental Economics (eeecon)
• (where): Innsbruck
• (when): 2021

Further information

• Handle: http://hdl.handle.net/10419/240437
• Last update: 10.03.2025, 11:43 AM CET