Follow the Leader: Simulations on a Dynamic Social Network
AbstractThis paper introduces a process of individual adjustment based on private local experiences and observation that allows for the emergence of a global social structure that is the equilibrium to the static follow-the-leader game of Goldbaum (2013). The setting rewards agents for being early adopters of popular products or trends. From simple, myopic, self-serving adjustment based on historic evidence by individuals emerges the the equilibrium social structure consisting of a single choice leader and a population of followers, which, in the static setting would require an unlikely degree of coordination to produce. Individual actions take place in a social context with individuals linked via one-way paths of observation. The strategy by which an agent chooses among the available options evolves over time. Different adjustment emergent processes contribute towards the understanding of the unfolding of events that generate the equilibrium structure.
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Bibliographic InfoPaper provided by Economics Discipline Group, UTS Business School, University of Technology, Sydney in its series Working Paper Series with number 15.
Date of creation: 01 Nov 2013
Date of revision:
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Leader; Dynamic Network; Social Interaction; Consumer Choice; Simulation;
Find related papers by JEL classification:
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
- C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-11-29 (All new papers)
- NEP-CMP-2013-11-29 (Computational Economics)
- NEP-GTH-2013-11-29 (Game Theory)
- NEP-SOC-2013-11-29 (Social Norms & Social Capital)
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