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Costly network formation and regular equilibria

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  • De Sinopoli, Francesco
  • Pimienta, Carlos

Abstract

We prove that for generic network-formation games where players incur a strictly positive cost to propose links the number of Nash equilibria is finite. Furthermore all Nash equilibria are regular and, therefore, stable sets.

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Bibliographic Info

Article provided by Elsevier in its journal Games and Economic Behavior.

Volume (Year): 69 (2010)
Issue (Month): 2 (July)
Pages: 492-497

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Handle: RePEc:eee:gamebe:v:69:y:2010:i:2:p:492-497

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Web page: http://www.elsevier.com/locate/inca/622836

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Keywords: Network-formation games Regular equilibrium Stable sets;

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  1. Antoni Calvó-Armengol & Rahmi Ilkiliç, 2005. "Pairwise-Stability and Nash Equilibria in Network Formation," Working Papers 2005.34, Fondazione Eni Enrico Mattei.
  2. Calvo-Armengol, Antoni, 2004. "Job contact networks," Journal of Economic Theory, Elsevier, Elsevier, vol. 115(1), pages 191-206, March.
  3. Pimienta, Carlos, 2009. "Generic determinacy of Nash equilibrium in network-formation games," Games and Economic Behavior, Elsevier, Elsevier, vol. 66(2), pages 920-927, July.
  4. Govindan, Srihari & McLennan, Andrew, 2001. "On the Generic Finiteness of Equilibrium Outcome Distributions in Game Forms," Econometrica, Econometric Society, Econometric Society, vol. 69(2), pages 455-71, March.
  5. Venkatesh Bala & Sanjeev Goyal, 2000. "A Noncooperative Model of Network Formation," Econometrica, Econometric Society, Econometric Society, vol. 68(5), pages 1181-1230, September.
  6. Jackson, Matthew O. & Wolinsky, Asher, 1996. "A Strategic Model of Social and Economic Networks," Journal of Economic Theory, Elsevier, Elsevier, vol. 71(1), pages 44-74, October.
  7. Francesco De Sinopoli & Giovanna Iannantuoni, 2002. "On The Generic Strategic Stability Of Nash Equilibria If Voting Is Costly," Economics Working Papers we025620, Universidad Carlos III, Departamento de Economía.
  8. Park, In-Uck, 1997. "Generic Finiteness of Equilibrium Outcome Distributions for Sender-Receiver Cheap-Talk Games," Journal of Economic Theory, Elsevier, Elsevier, vol. 76(2), pages 431-448, October.
  9. De Sinopoli, Francesco, 2001. "On the Generic Finiteness of Equilibrium Outcomes in Plurality Games," Games and Economic Behavior, Elsevier, Elsevier, vol. 34(2), pages 270-286, February.
  10. Mertens, J.-F., 1988. "Stable equilibria - a reformulation," CORE Discussion Papers, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) 1988038, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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