The paper examines the formation of free trade agreements (FTAs) as a network formation game. We consider a general n-country model in which countries trade differentiated industrial commodities as well as a numeraire good. Countries may be different in the size of the industrial good industry...

We study the stability properties of organizations in partition function games, describing cooperative situations with externalities. An organization is defined as a group of agents, together with a set of bilateral relations, formally, a connected graph. Because of the presence of...