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Network Disruption and the Common Enemy Effect

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  • B. Hoyer
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    Abstract

    "The enemy of my enemy is my friend." This common adage, which seems to be adhered to in social interactions (e.g. high school cliques or work relationships) as well as in political alliances within countries and between countries, describes the ability of groups or people to work together when they face an opponent, although otherwise they have little in common. In social psychology this phenomenon has been termed the "common enemy effect". Such group behavior can be studied using networks to depict the players within a group and the relationships between them. In this paper we study the effect of a common enemy on a model of network formation, where self-interested, myopic players can use links to build a network, knowing that they are facing a common enemy who can disrupt the links within the network and whose goal it is to minimize the overall value of the network. We find that introducing such a common enemy can lead to the formation of stable and efficient networks which would not be stable without the threat of disruption. However, we also find that fragmented networks as well as the empty networks are also stable. While the common enemy can thus have a positive effect on the incentives of players to form an efficient network, it can also lead to fragmentation and disintegration of the network.

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    File URL: http://dspace.library.uu.nl/bitstream/handle/1874/262523/12-06.pdf
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    Bibliographic Info

    Paper provided by Utrecht School of Economics in its series Working Papers with number 12-06.

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    Length: 25 pages
    Date of creation: 25 Jan 2013
    Date of revision:
    Handle: RePEc:use:tkiwps:1206

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    Related research

    Keywords: strategic network disruption; strategic network design; non-cooperative network games;

    This paper has been announced in the following NEP Reports:

    References

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    1. Kirchsteiger, Georg & Mantovani, Marco & Mauleon, Ana & Vannetelbosch, Vincent, 2011. "Myopic or Farsighted? An Experiment on Network Formation," CEPR Discussion Papers 8263, C.E.P.R. Discussion Papers.
    2. Dan Kovenock & Brian Roberson, 2010. "The Optimal Defense of Networks of Targets," Purdue University Economics Working Papers 1251, Purdue University, Department of Economics.
    3. Matthew O. Jackson & Asher Wolinsky, 1994. "A Strategic Model of Social and Economic Networks," Discussion Papers 1098, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    4. K.J.M. De Jaegher & B. Hoyer, 2010. "Strategic Network Disruption and Defense," Working Papers 10-13, Utrecht School of Economics.
    5. Herings, P. Jean-Jacques & Mauleon, Ana & Vannetelbosch, Vincent, 2009. "Farsightedly stable networks," Games and Economic Behavior, Elsevier, vol. 67(2), pages 526-541, November.
    6. Satya P. Das & Prabal Roy Chowdhury, 2014. "Deterrence, Preemption, And Panic: A Common-Enemy Problem Of Terrorism," Economic Inquiry, Western Economic Association International, vol. 52(1), pages 219-238, 01.
    7. KIRCHSTEIGER, Georg & MANTOVANI, Marco & MAULEON, Ana & VANNETELBOSCH, Vincent, 2013. "Limited farsightedness in network formation," CORE Discussion Papers 2013033, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    8. Mariagiovanna Baccara & Heski Bar-Isaac, 2008. "How to Organize Crime -super-1," Review of Economic Studies, Oxford University Press, vol. 75(4), pages 1039-1067.
    9. Walter Enders & Paan Jindapon, 2010. "Network Externalities and the Structure of Terror Networks," Journal of Conflict Resolution, Peace Science Society (International), vol. 54(2), pages 262-280, April.
    10. Coralio Ballester & Antoni Calvó-Armengol & Yves Zenou, 2004. "Who's Who in Networks. Wanted: The Key Player," Working Papers 178, Barcelona Graduate School of Economics.
    11. Venkatesh Bala & Sanjeev Goyal, 2000. "A Noncooperative Model of Network Formation," Econometrica, Econometric Society, vol. 68(5), pages 1181-1230, September.
    12. repec:cor:louvrp:2171 is not listed on IDEAS
    13. Heski Bar-Isaac & Mariagiovanna Baccara, 2006. "How to Organize Crime," Working Papers 06-07, New York University, Leonard N. Stern School of Business, Department of Economics.
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    Cited by:
    1. K.J.M. De Jaegher & B. Hoyer, 2012. "Cooperation and the common enemy effect," Working Papers 12-24, Utrecht School of Economics.

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