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Influence and Social Tragedy in Networks

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Author Info

  • Yann Rébillé

    ()
    (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272)

  • Lionel Richefort

    ()
    (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272)

Abstract

We model agents in a network game of strategic complements and negative externalities. Sufficient conditions for the existence of a unique Nash equilibrium and of a unique social optimum are established. Under these conditions, we find that players with more vulnerable locations in the network exert more effort at equilibrium, and that the most influential players should exert less effort at efficiency. We then find structural conditions under which each player exerts strictly more effort than her efficient level, whether the social optimum be interior or not.

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Bibliographic Info

Paper provided by HAL in its series Working Papers with number hal-00924017.

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Date of creation: 06 Jan 2014
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Handle: RePEc:hal:wpaper:hal-00924017

Note: View the original document on HAL open archive server: http://hal.archives-ouvertes.fr/hal-00924017
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Web page: http://hal.archives-ouvertes.fr/

Related research

Keywords: Network; strategic complements; equilibrium; efficiency; social tragedy.;

This paper has been announced in the following NEP Reports:

References

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  1. Yann Rébillé & Lionel Richefort, 2012. "Welfare Analysis in Games with substitutabilities," Working Papers hal-00732950, HAL.
  2. John Kennan, 2001. "Uniqueness of Positive Fixed Points for Increasing Concave Functions on Rn: An Elementary Result," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 4(4), pages 893-899, October.
  3. Nizar Allouch, 2012. "On the Private Provision of Public Goods on Networks," Working Papers 2012.40, Fondazione Eni Enrico Mattei.
  4. Yann Rébillé & Lionel Richefort, 2012. "Equilibrium Existence and Uniqueness In Network Games with Additive Preferences," Working Papers hal-00732962, HAL.
  5. Yann Rébillé & Lionel Richefort, 2012. "Sharing Water from many Rivers," Working Papers hal-00678997, HAL.
  6. Veblen, Thorstein, 1899. "The Theory of the Leisure Class," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1899.
  7. Acharya, Avidit & Ramsay, Kristopher W., 2013. "The Calculus of the Security Dilemma," International Quarterly Journal of Political Science, now publishers, vol. 8(2), pages 183-203, April.
  8. H. Scott Gordon, 1954. "The Economic Theory of a Common-Property Resource: The Fishery," Journal of Political Economy, University of Chicago Press, vol. 62, pages 124.
  9. Frank, Robert H, 1985. "The Demand for Unobservable and Other Nonpositional Goods," American Economic Review, American Economic Association, vol. 75(1), pages 101-16, March.
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