This paper studies coalition formation among individuals who differ in productivity. The output of a coalition is determined by the sum of the productivities and the size of the coalition. We consider egalitarian societies in which coalitions split their surplus equally and individualistic...

This paper studies coalition formation among individuals who differ in productivity. The output of a coalition is determined by the sum of productivities if the coalition exceeds a minimal threshold of members. We consider competitive societies in which the surplus of a coalition is split...