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Directed Networks with Spillovers

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  • PASCAL BILLAND
  • CHRISTOPHE BRAVARD
  • SUDIPTA SARANGI

Abstract

We study noncooperative network formation in two types of directed networks. In the first type, called the model with global spillovers, the payoff of a player depends on the number of links she forms as well as the total number of links formed by all other players. In the second type, called the model with local spillovers, the payoff of a player depends on the number of links she forms and the total number of links formed by her immediate neighbors, as well as the number of links formed by players outside her neighborhood. For both classes of games we investigate the existence of pure strategy Nash equilibria and characterize the Nash networks under a number of different second order conditions on the payoff function.
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Suggested Citation

  • Pascal Billand & Christophe Bravard & Sudipta Sarangi, 2012. "Directed Networks with Spillovers," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(6), pages 849-878, December.
  • Handle: RePEc:bla:jpbect:v:14:y:2012:i:6:p:849-878 DOI: jpet.12000
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    1. repec:hal:journl:halshs-01316936 is not listed on IDEAS
    2. Philipp Möhlmeier & Agnieszka Rusinowska & Emily Tanimura, 2016. "Competition for the access to and use of information in networks," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01316936, HAL.
    3. Pascal Billand & Christophe Bravard & Sudipta Sarangi, 2011. "Local Spillovers, Convexity and the Strategic Substitutes Property in Networks," Working Papers 1110, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    4. repec:eee:gamebe:v:105:y:2017:i:c:p:40-58 is not listed on IDEAS
    5. Philipp Möhlmeier & Agnieszka Rusinowska & Emily Tanimura, 2013. "A degree-distance-based connections model with negative and positive externalities," Documents de travail du Centre d'Economie de la Sorbonne 13040, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    6. Philipp Möhlmeier & Agnieszka Rusinowska & Emily Tanimura, 2016. "Competition for the access to and use of information in networks," Documents de travail du Centre d'Economie de la Sorbonne 16033, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.

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