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Contagion and efficiency

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Author Info
Alós-Ferrer, Carlos
Weidenholzer, Simon

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Abstract

We consider a population of agents, either finite or countably infinite, located on an arbitrary network. Agents interact directly only with their immediate neighbors, but are able to observe the behavior of (some) other agents beyond their interaction neighborhood, and learn from that behavior by imitating successful actions. If interactions are not "too global" but information is fluid enough, we show that the efficient action is the only one which can spread contagiously to the whole population from an initially small, finite subgroup. This result holds even in the presence of an alternative, -dominant action.

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Publisher Info
Article provided by Elsevier in its journal Journal of Economic Theory.

Volume (Year): 143 (2008)
Issue (Month): 1 (November)
Pages: 251-274
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Handle: RePEc:eee:jetheo:v:143:y:2008:i:1:p:251-274

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Web page: http://www.elsevier.com/locate/inca/622869

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Related research
Keywords: Local interaction games Learning Imitation;

Cited by:
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  1. Roland Pongou & Roberto Serrano, 2009. "A Dynamic Theory of Fidelity Networks with an Application to the Spread of HIV/AIDS," Working Papers 2009-2, Brown University, Department of Economics. [Downloadable!]
    Other versions:
  2. Mengel, Friederike, 2007. "Conformism and Cooperation in a Local Interaction Model," MPRA Paper 4051, University Library of Munich, Germany. [Downloadable!]
    Other versions:
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This page was last updated on 2009-12-3.


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