Interactive Blocking in Arrow-Debreu Economies

Competitive behaviors such as outbidding one’s rivals may be countered by therivals’ threat of mutually destructive objections. In an Arrow-Debreu model of productioneconomies with firms privatized by property rights, we model such hinderedcompetitive behaviors as a coalition’s attempt to block a status quo given the threatthat the outsiders of the coalition, especially those with whom the coalition sharesownership of firms, may resort to production-ruining secession. We introduce new conceptsof the core such that a coalition’s blocking plan is feasible only if it is not blockedby the outsiders with such secession. Based on such notions, we prove core equivalencetheorems in the replication framework.[...]