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Network Design under Local Complementarities

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  • Mohamed Belhaj

    ()
    (AMSE - Aix-Marseille School of Economics - Aix-Marseille Univ. - Centre national de la recherche scientifique (CNRS) - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Centrale Marseille (ECM))

  • Sebastian Bervoets

    ()
    (AMSE - Aix-Marseille School of Economics - Aix-Marseille Univ. - Centre national de la recherche scientifique (CNRS) - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Centrale Marseille (ECM))

  • Frédéric Deroïan

    ()
    (AMSE - Aix-Marseille School of Economics - Aix-Marseille Univ. - Centre national de la recherche scientifique (CNRS) - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Centrale Marseille (ECM))

Abstract

We consider agents playing a linear network game with strategic complementarities. We analyse the problem of a policy maker who can change the structure of the network in order to increase the aggregate efforts of the individuals and/or the sum of their utilities, given that the number of links of the network has to remain fixed. We identify some link reallocations that guarantee an improvement of aggregate efforts and/or aggregate utilities. With this comparative statics exercise, we then prove that the networks maximising both aggregate outcomes (efforts and utilities) belong to the class of Nested-Split Graphs.

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Bibliographic Info

Paper provided by HAL in its series Working Papers with number halshs-00796487.

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Date of creation: Feb 2013
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Handle: RePEc:hal:wpaper:halshs-00796487

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Related research

Keywords: Network; Linear Interaction; Bonacich Centralities; Strategic Complementarity; Nested Split Graphs;

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References

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Cited by:
  1. Sudipta Sarangi & Pascal Billand & Christophe Bravard & Jacques Durieu, . "Efficient networks for a class of games with global spillovers," Departmental Working Papers 2013-06, Department of Economics, Louisiana State University.
  2. Pascal Billand & Christophe Bravard & Subhadip Chakrabarti & Sudipta Sarangi, 2013. "Abram Bergson," Working Papers 1339, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
  3. Pascal Billand & Christophe Bravard & Subhadip Chakrabarti & Sudipta Sarangi, 2014. "A Note on Networks of Collaboration in Multi-market Oligopolies," Working Papers halshs-00924990, HAL.

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