Voting in Assemblies of shareholders and Incomplete Markets

Mich Tvede (1) , Hervé Crès (2)

1 Department of Economics [Copenhagen]
2 ECON - Département d'économie (Sciences Po)

An economy with two dates is considered, one state at the ¯rst date and a ¯nite number of states at the last date. Shareholders determine production plans by voting { one share, one vote { and at ½-majority stable equilibria, alternative production plans are supported by at most ½ £ 100 percent of the shareholders. It is shown that a ½-majority stable equilibrium exists provided that ½ ¸ min ½ S ¡ J S ¡ J + 1 ; B B + 1 ¾ where S is the number of states at the last date, J is the number of ¯rms and B is the dimensions of the sets of e±cient production plans for ¯rms. Moreover, an example shows that ½-majority stable equilibria need not exist for smaller ½'s.

Domaines: Economies et finances

Mich Tvede, Hervé Crès. Voting in Assemblies of shareholders and Incomplete Markets. 2001. ⟨hal-01064884⟩