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Topologies of social interactions

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  • Yannis Ioannides

Abstract

The paper extends the Brock-Durlauf social interactions model to richer social structures modelled with arbitrary interaction topologies and examines in detail the star, the wheel and the path. It explores Nash equilibria when agents act on the basis of expectations over, and, alternatively, actual knowledge their neighbors’ decisions. It links social interactions with econometrics of systems of simultaneous equations. The local dynamics near steady states combine spectral properties of the adjacency matrix and of the nonlinearities of reaction functions. For regular interaction topologies, adjustment exhibit relative persistence. Cyclical interaction is associated with endogenous spatial oscillations and islands of conformity. Copyright Springer-Verlag Berlin/Heidelberg 2006

Suggested Citation

  • Yannis Ioannides, 2006. "Topologies of social interactions," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 28(3), pages 559-584, August.
    • Handle: RePEc:spr:joecth:v:28:y:2006:i:3:p:559-584
    DOI: 10.1007/s00199-005-0646-1
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    More about this item

    Keywords

    Social interactions; Dynamics; Spatial oscillations; Interactive discrete choice; Neighborhood effects; Ising model; Random fields; Random networks.;
    All these keywords.

    JEL classification:

    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • C45 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Neural Networks and Related Topics
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General

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