A BEJEAP Topics article.

Abstract

We examine a club model in which the club's policies are controlled by a homogeneous group of insiders. Their policy decision is to determine the number they will admit from two outsider groups. Countries have immigration policies, private clubs have membership policies, and professional practices also have membership criteria in which individuals may be screened. In all these organizations new members bring a material benefit to the organization, but do so at the cost of introducing a socially differentiated population of outsiders that the majority typically dislikes. It is the interplay of the material benefit and the social cost on which we focus. We characterize steady state equilibria and examine comparative statics results.

Submitted: August 6, 2003 · Accepted: February 26, 2004 · Published: March 23, 2004

Originally published in Topics in Economic Analysis & Policy.

Recommended Citation

Biglaiser, Gary and Friedman, James (2004) "Membership Diversity in Club Decisions," Topics in Economic Analysis & Policy: Vol. 4 : Iss. 1, Article 7.
Available at: http://www.bepress.com/bejeap/topics/vol4/iss1/art7