INR 2002 Lecture Notes - Lecture 10: Pareto Efficiency

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Cooperation is characterized as a positive-sum game and is the result of coordination or collaboration. Cooperation makes at least one party better off than otherwise; referred to as a positive-sum game. Involves the potential for mutual gain; consists of mutual policy adjustments that move actors towards the frontier. *coordination type of cooperative interaction in which actors benefit from all making the same choices, and subsequently have no incentive not to comply. Actors benefit from all making the same choices. Ex; deciding which side of the road cars should drive on. *collaboration actors gain from working together but nonetheless have incentives to not comply with any agreement. Motivated not by the collective outcome, but the individual benefit (shortened sentences) Efforts to produce public goods always face collective action problems each actor aims to benefit from the contribution of others without bearing the costs themselves. i. e. free riders. Cooperation is more likely to occur when there is more time and more issues.

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