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Stable Networks and Convex Payoffs

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  • Sudipta Sarangi
  • Robert P. Gilles

Abstract

Recently a variety of link-based stability concepts have emerged in the literature on game theoretic models of social network formation. We investigate two basic formation properties that establish equivalence between some well known types of stable networks and their natural extensions. These properties can be identified as convexity conditions on the network payoff structures.

Suggested Citation

  • Sudipta Sarangi & Robert P. Gilles, 2005. "Stable Networks and Convex Payoffs," Departmental Working Papers 2005-13, Department of Economics, Louisiana State University.
    • Handle: RePEc:lsu:lsuwpp:2005-13
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    File URL: https://www.lsu.edu/business/economics/files/workingpapers/pap05_13.pdf
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    References listed on IDEAS

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    1. Antoni Calvó-Armengol & Rahmi İlkılıç, 2009. "Pairwise-stability and Nash equilibria in network formation," International Journal of Game Theory, Springer;Game Theory Society, vol. 38(1), pages 51-79, March.
    2. Jackson, Matthew O. & van den Nouweland, Anne, 2005. "Strongly stable networks," Games and Economic Behavior, Elsevier, vol. 51(2), pages 420-444, May.
    3. Jackson, Matthew O. & Wolinsky, Asher, 1996. "A Strategic Model of Social and Economic Networks," Journal of Economic Theory, Elsevier, vol. 71(1), pages 44-74, October.
    4. Demange,Gabrielle & Wooders,Myrna (ed.), 2005. "Group Formation in Economics," Cambridge Books, Cambridge University Press, number 9780521842716.
    5. Paul Belleflamme & Francis Bloch, 2004. "Market sharing agreements and collusive networks," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(2), pages 387-411, May.
    6. Bloch, Francis & Jackson, Matthew O., 2007. "The formation of networks with transfers among players," Journal of Economic Theory, Elsevier, vol. 133(1), pages 83-110, March.
    7. Sanjeev Goyal & Sumit Joshi, 2006. "Unequal connections," International Journal of Game Theory, Springer;Game Theory Society, vol. 34(3), pages 319-349, October.
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    Citations

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    Cited by:

    1. Daniel E. May, 2015. "Inefficient Stable International Trade Networks," Studies in Microeconomics, , vol. 3(1), pages 13-34, June.
    2. Hellmann, Tim & Staudigl, Mathias, 2014. "Evolution of social networks," European Journal of Operational Research, Elsevier, vol. 234(3), pages 583-596.
    3. Gualdani, Cristina, 2018. "An Econometric Model of Network Formation with an Application to Board Interlocks between Firms," TSE Working Papers 17-898, Toulouse School of Economics (TSE), revised Jul 2019.
    4. Robert P. Gilles & Sudipta Sarangi, 2006. "Building Social Networks," Discussion Papers of DIW Berlin 642, DIW Berlin, German Institute for Economic Research.
    5. Antoni Calvó-Armengol & Rahmi İlkılıç, 2009. "Pairwise-stability and Nash equilibria in network formation," International Journal of Game Theory, Springer;Game Theory Society, vol. 38(1), pages 51-79, March.
    6. May, Daniel & McCorriston, Steve, 2015. "Global Agreements in Agriculture: A Network Approach with Market Intermediaries," 2015 Conference, August 9-14, 2015, Milan, Italy 212451, International Association of Agricultural Economists.
    7. Ben R. Craig & Yiming Ma, 2020. "Intermediation in the Interbank Lending Market," Working Papers 20-09, Federal Reserve Bank of Cleveland.
    8. Tim Hellmann, 2013. "On the existence and uniqueness of pairwise stable networks," International Journal of Game Theory, Springer;Game Theory Society, vol. 42(1), pages 211-237, February.
    9. Gualdani, Cristina, 2021. "An econometric model of network formation with an application to board interlocks between firms," Journal of Econometrics, Elsevier, vol. 224(2), pages 345-370.
    10. Sudipta Sarangi & Robert P. Gilles, 2005. "The Role of Beliefs and Confidence in Building Social Networks," Departmental Working Papers 2005-15, Department of Economics, Louisiana State University.

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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other

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