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On the emergence of scale-free production networks

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  • Gualdi, Stanislao
  • Mandel, Antoine

Abstract

We propose a simple dynamical model for the formation of production networks among monopolistically competitive firms. The model subsumes the standard general equilibrium approach à la Arrow–Debreu but displays a wide set of potential dynamic behaviors. It robustly reproduces key stylized facts of firms׳ demographics. Our main result is that competition between intermediate good producers generically leads to the emergence of scale-free production networks.

Suggested Citation

  • Gualdi, Stanislao & Mandel, Antoine, 2016. "On the emergence of scale-free production networks," Journal of Economic Dynamics and Control, Elsevier, vol. 73(C), pages 61-77.
  • Handle: RePEc:eee:dyncon:v:73:y:2016:i:c:p:61-77
    DOI: 10.1016/j.jedc.2016.09.012
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    Cited by:

    1. repec:eee:dyncon:v:83:y:2017:i:c:p:232-269 is not listed on IDEAS
    2. repec:eee:quaeco:v:67:y:2018:i:c:p:227-236 is not listed on IDEAS
    3. Stanislao Gualdi & Antoine Mandel, 2016. "Endogenous Growth in Production Networks," Documents de travail du Centre d'Economie de la Sorbonne 16054, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    4. Vipin P. Veetil & Lawrence H. White, 2017. "Towards a New Austrian Macroeconomics," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 30(1), pages 19-38, March.

    More about this item

    Keywords

    C67; D50; L16; Production network; Scale-free networks; Firms demographics; Distribution of firms׳ size; General equilibrium; Monopolistic competition;

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure

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