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Games on Multiplex Networks

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Listed:
  • Yves Zenou
  • Junjie Zhou

Abstract

We develop a simple multilayer network model in which agents allocate effort across layers with heterogeneous structures, subject to an aggregate effort constraint. Incentives are shaped by agents' network positions within each layer, and equilibrium behavior reflects both within- and cross-layer interactions. We analyze how shocks propagate through the network and characterize optimal targeting interventions. Our results show that effective policy design must account for effort allocation across layers. We also demonstrate that predictions from monolayer models can diverge sharply from those of multilayer models, underscoring the importance of accounting for network complexity in both empirical and policy analyses.

Suggested Citation

  • Yves Zenou & Junjie Zhou, 2026. "Games on Multiplex Networks," American Economic Review, American Economic Association, vol. 116(4), pages 1415-1458, April.
    • Handle: RePEc:aea:aecrev:v:116:y:2026:i:4:p:1415-58
    DOI: 10.1257/aer.20240763
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    References listed on IDEAS

    as
    1. Bramoullé, Y. & Ghiglino, C., 2024. "Status Consumption in Networks: A Reference Dependent Approach," Cambridge Working Papers in Economics 2414, Faculty of Economics, University of Cambridge.
    2. Peter Kuhn & Peter Kooreman & Adriaan Soetevent & Arie Kapteyn, 2011. "The Effects of Lottery Prizes on Winners and Their Neighbors: Evidence from the Dutch Postcode Lottery," American Economic Review, American Economic Association, vol. 101(5), pages 2226-2247, August.
    3. repec:cam:camjip:2409 is not listed on IDEAS
    4. Abhijit Banerjee & Emily Breza & Arun G Chandrasekhar & Esther Duflo & Matthew O Jackson & Cynthia Kinnan, 2024. "Changes in Social Network Structure in Response to Exposure to Formal Credit Markets," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(3), pages 1331-1372.
    5. Sumit Agarwal & Vyacheslav Mikhed & Barry Scholnick, 2020. "Peers’ Income and Financial Distress: Evidence from Lottery Winners and Neighboring Bankruptcies," The Review of Financial Studies, Society for Financial Studies, vol. 33(1), pages 433-472.
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    Cited by:

    1. Zenou, Yves, 2026. "Peer vs. Network Effects: Microfoundations, Identification, and Beyond," IZA Discussion Papers 18501, IZA Network @ LISER.

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    More about this item

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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