The Structure of Online Consumer Communication Networks
AbstractIn this paper we study the structure of the bilateral communication links within Online Consumer Communication Networks (OCCNs), such as virtual communities. Compared to the offline world, consumers in online networks are highly flexible to choose their communication partners and little is known about how this affects communication exchange structures. We analyze these structures by using a general approach from the game-theoretic literature of social and economic network formation where individuals trade off the cost of forming and maintaining links against the potential rewards of doing so, which results in a stable network structure. In our analysis, a combination of aspects common to OCCNs is incorporated that has not been investigated in this literature until now. First, the negative externality of communication specificity is included in the sense that the more direct connections an individual has to maintain with other individuals, the less she is able to specify her attention per link within her total time available. Therefore, the additive value per individual of her communications declines with an increasing number of links, and she also derives less additive value per individual from others with an increasing number of links. Second, a distinction is made between the social and informational value of communication, where informational communication value is assumed to be transferable via indirect links, whereas social communication value is not transferable. Analytical results are derived by using the concept of pairwise stability. A tendency towards fragmented pairwise stable structures - consisting of small, disjoint (star) components - is discovered, which can be attributed to the joint effect of the two aspects mentioned. We demonstrate that only some of the pairwise stable structures provide optimal welfare (total payoffs), and that the relative focus on informational versus social value of communication affects this welfare.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization in its series Research Memoranda with number 028.
Date of creation: 2006
Date of revision:
Contact details of provider:
Web page: http://www.maastrichtuniversity.nl/web/UMPublications.htm
Other versions of this item:
- Harmsen - van Hout, Marjolein J.W. & Herings, P. Jean-Jacques & Dellaert, Benedict G.C., 2010. "The Structure of Online Consumer Communication Networks," FCN Working Papers 3/2010, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).
- A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
- C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-03-25 (All new papers)
- NEP-GTH-2006-03-25 (Game Theory)
- NEP-MIC-2006-03-25 (Microeconomics)
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Charles Bollen).
If references are entirely missing, you can add them using this form.