Games of Social Influence
AbstractThis paper considers a game played among players who seek to extract payoffs from a group of individuals subject to local interaction effects. We are interested in the relation between the network of social interaction and equilibrium actions and payoffs. We start with an analysis of two economic examples � strategic advertising in the presence of word of mouth advertising and social non-competitive marketing � to bring out the simple point that changing network connections can increase as well as decrease equilibrium actions and payoffs. This leads to an investigation of general conditions on payoffs under which equilibrium actions and payoffs increase/decrease with an increase in density of connections. We also develop conditions under which a greater dispersion in network connections leads unambiguously to positive and negative effects on actions as well as payoffs.
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Bibliographic InfoPaper provided by University of Essex, Department of Economics in its series Economics Discussion Papers with number 639.
Date of creation: 25 Sep 2007
Date of revision:
Postal: Discussion Papers Administrator, Department of Economics, University of Essex, Wivenhoe Park, Colchester CO4 3SQ, U.K.
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-10-06 (All new papers)
- NEP-GTH-2007-10-06 (Game Theory)
- NEP-NET-2007-10-06 (Network Economics)
- NEP-SOC-2007-10-06 (Social Norms & Social Capital)
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