We present a theory of ethnic conflict in which coalitions formed along ethnic lines competefor the economy’s resources …. The role of ethnicity is to enforce coalition membership: inethnically homogeneous societies members of the losing … coalition can defect to the winnersat low cost, and this rules out conflict as an equilibrium outcome. We derive a numberof …

policymaker is a coalition where all social groups are represented equally.Empirical evidence from a sample of high-debt OECD … countries is found to be broadlyconsistent with the theoretical results: regression results indicate that 'coalition premia' and …

The core is reformulated to incorporate the externality typical in strategic formgames. Any coalition of players may … deviate by trying to commit to a profile of actionsdifferent from a status quo. The outsiders of the coalition may take a … coordinatedmeasure, incentive-feasibly for themselves, to preempt the coalition’s commitment. If acoalition succeeds in committing to its …

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 …

authority among shareholders, because a blocking coalition’sresources are affected by the firms it jointly owns with outsiders …