Diffusion and cascading behavior in random networks
The spread of new ideas, behaviors or technologies has been extensively studied using epidemic models. Here we consider a model of diffusion where the individualsʼ behavior is the result of a strategic choice. We study a simple coordination game with binary choice and give a condition for a new action to become widespread in a random network. We also analyze the possible equilibria of this game and identify conditions for the coexistence of both strategies in large connected sets. Finally we look at how can firms use social networks to promote their goals with limited information. Our results differ strongly from the one derived with epidemic models and show that connectivity plays an ambiguous role: while it allows the diffusion to spread, when the network is highly connected, the diffusion is also limited by high-degree nodes which are very stable.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gai, Prasanna & Kapadia, Sujit, 2010. "Contagion in financial networks," Bank of England working papers 383, Bank of England.
- Matthew O. Jackson & Leeat Yariv, 2007.
"Diffusion of Behavior and Equilibrium Properties in Network Games,"
American Economic Review,
American Economic Association, vol. 97(2), pages 92-98, May.
- Jackson, Matthew O. & Yariv, Leeat, 2006. "Diffusion of Behavior and Equilibrium Properties in Network Games," Working Papers 1264, California Institute of Technology, Division of the Humanities and Social Sciences.
- Andrea Galeotti & Sanjeev Goyal & Matthew O. Jackson & Fernando Vega-Redondo & Leeat Yariv, 2010.
Review of Economic Studies,
Oxford University Press, vol. 77(1), pages 218-244.
- Lawrence Blume, 1993.
"The Statistical Mechanics of Best-Response Strategy Revision,"
Game Theory and Information
9307001, EconWPA, revised 26 Jan 1994.
- Blume Lawrence E., 1995. "The Statistical Mechanics of Best-Response Strategy Revision," Games and Economic Behavior, Elsevier, vol. 11(2), pages 111-145, November.
- H. Peyton Young, 2009. "Innovation Diffusion in Heterogeneous Populations: Contagion, Social Influence, and Social Learning," American Economic Review, American Economic Association, vol. 99(5), pages 1899-1924, December.
- Andrea Galeotti & Sanjeev Goyal, 2009. "Influencing the influencers: a theory of strategic diffusion," RAND Journal of Economics, RAND Corporation, vol. 40(3), pages 509-532.
- Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521674096.
- Young, H Peyton, 1993. "The Evolution of Conventions," Econometrica, Econometric Society, vol. 61(1), pages 57-84, January.
- H Peyton Young, 2000. "The Diffusion of Innovations in Social Networks," Economics Working Paper Archive 437, The Johns Hopkins University,Department of Economics.
- Fudenberg, Drew & Ellison, Glenn, 1995.
"Word-of-Mouth Communication and Social Learning,"
3196300, Harvard University Department of Economics.
- repec:tpr:qjecon:v:110:y:1995:i:1:p:93-125 is not listed on IDEAS
- Kandori, Michihiro & Mailath, George J & Rob, Rafael, 1993.
"Learning, Mutation, and Long Run Equilibria in Games,"
Econometric Society, vol. 61(1), pages 29-56, January.
- M. Kandori & G. Mailath & R. Rob, 1999. "Learning, Mutation and Long Run Equilibria in Games," Levine's Working Paper Archive 500, David K. Levine.
- Kandori, M. & Mailath, G.J., 1991. "Learning, Mutation, And Long Run Equilibria In Games," Papers 71, Princeton, Woodrow Wilson School - John M. Olin Program.
- Blume Lawrence E., 1993.
"The Statistical Mechanics of Strategic Interaction,"
Games and Economic Behavior,
Elsevier, vol. 5(3), pages 387-424, July.
- L. Blume, 2010. "The Statistical Mechanics of Strategic Interaction," Levine's Working Paper Archive 488, David K. Levine.
- Ellison, Glenn, 1993.
"Learning, Local Interaction, and Coordination,"
Econometric Society, vol. 61(5), pages 1047-71, September.
- Dunia López-Pintado, 2004.
"Diffusion In Complex Social Networks,"
Working Papers. Serie AD
2004-33, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521857406.
- Battiston, Stefano & Delli Gatti, Domenico & Gallegati, Mauro & Greenwald, Bruce & Stiglitz, Joseph E., 2012.
"Liaisons dangereuses: Increasing connectivity, risk sharing, and systemic risk,"
Journal of Economic Dynamics and Control,
Elsevier, vol. 36(8), pages 1121-1141.
- Stefano Battiston & Domenico Delli Gatti & Mauro Gallegati & Bruce C. Greenwald & Joseph E. Stiglitz, 2009. "Liaisons Dangereuses: Increasing Connectivity, Risk Sharing, and Systemic Risk," NBER Working Papers 15611, National Bureau of Economic Research, Inc.
- repec:oup:qjecon:v:110:y:1995:i:1:p:93-125 is not listed on IDEAS
When requesting a correction, please mention this item's handle: RePEc:eee:gamebe:v:75:y:2012:i:2:p:752-775. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.