Follow the Leader: Simulations on a Dynamic Social Network
AbstractAn agent based model is developed in which a social hierarchy of leaders and followers emerges from a uniform or random social network. The formation of the social structure is driven by the desire to be an early adopter of a subsequently popular trend. The environment is related to a majority game, but introduces the importance of the timing of adoption. The proposed environment is relevant to a number of settings in which leadership and timing of decisions are important or being perceived as a trend setter is rewarded. The leadership position can be selfreinforcing. For a professional critic, for example, a cult-of-personality can dictate popular tastes, such as in art, food, and wine markets. A social hierarchy can also apply to the introduction of new products or ideas including academic research and financial market analysts.
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Bibliographic InfoPaper provided by Finance Discipline Group, UTS Business School, University of Technology, Sydney in its series Working Paper Series with number 155.
Date of creation: 01 Oct 2008
Date of revision:
dynamic network; social interaction; consumer choice;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-11-18 (All new papers)
- NEP-CBE-2008-11-18 (Cognitive & Behavioural Economics)
- NEP-CMP-2008-11-18 (Computational Economics)
- NEP-NET-2008-11-18 (Network Economics)
- NEP-SOC-2008-11-18 (Social Norms & Social Capital)
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- David Goldbaum, 2009. "Follow the Leader: Steady State Analysis of a Dynamic Social Network," Working Paper Series 158, Finance Discipline Group, UTS Business School, University of Technology, Sydney.
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