Publications

Working Paper

This paper takes the hierarchical resource allocation model in Van Zandt (2003) and derives a simpler, reduced-form model of balanced hierarchies. This model uses continuous approximations; the author derives bounds on the errors due to these approximations.

He then gives results that indicate that optimal hierarchies in the general model of are approximately balanced. In particular, the author shows that aggregation should be balanced if the hierarchical structure is balanced and he shows that the hierarchical structure should be balanced if aggregation is balanced.

Download PDF