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One-way flow network formation under constraints

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  • Norma Olaizola
  • Federico Valenciano

Abstract

We study the effects of institutional constraints on stability and efficiency in the “one-way flow” model of network formation. In this model the information that flows through a link between two players runs only towards the player that initiates and supports the link, so in order for it to flow in both directions, both players must pay whatever the unit cost of a directional link is. We assume that an exogenous “societal cover” consisting of a collection of possibly overlapping subsets covering the set of players specifies the social organization in different groups or “societies,” so that a player may initiate links only with players that belong to at least one society that he/she also belongs to, thus restricting the feasible strategies and networks. In this setting, we examine the impact of such societal constraints on stable/efficient architectures and on dynamics. Copyright Sociedad de Estadística e Investigación Operativa 2014

Suggested Citation

  • Norma Olaizola & Federico Valenciano, 2014. "One-way flow network formation under constraints," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 22(2), pages 624-643, July.
    • Handle: RePEc:spr:topjnl:v:22:y:2014:i:2:p:624-643
    DOI: 10.1007/s11750-013-0284-x
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    7. Olaizola Ortega, María Norma & Valenciano Llovera, Federico, 2011. "Network formation under institutional constraints," IKERLANAK 2011-51, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
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    10. Olaizola Ortega, María Norma & Valenciano Llovera, Federico, 2011. "Network formation under institutional constraints," IKERLANAK info:eu-repo/grantAgreeme, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
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    Cited by:

    1. Rêgo, Leandro Chaves & dos Santos, Andrea Maria, 2019. "Co-authorship model with link strength," European Journal of Operational Research, Elsevier, vol. 272(2), pages 587-594.
    2. Olaizola, Norma & Valenciano, Federico, 2014. "Asymmetric flow networks," European Journal of Operational Research, Elsevier, vol. 237(2), pages 566-579.
      • Olaizola Ortega, María Norma & Valenciano Llovera, Federico, 2012. "Asymmetric flow networks," IKERLANAK http://www-fae1-eao1-ehu-, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
    3. Olaizola, Norma & Valenciano, Federico, 2013. "Network formation under linking constraints," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 392(20), pages 5194-5205.
    4. Cui, Zhiwei & Wang, Shouyang & Zhang, Jin & Zu, Lei, 2013. "Stochastic stability in one-way flow networks," Mathematical Social Sciences, Elsevier, vol. 66(3), pages 410-421.

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    More about this item

    Keywords

    Network formation; One-way flow model; Stability; Dynamics; A14; C72; D20; J00;
    All these keywords.

    JEL classification:

    • A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D20 - Microeconomics - - Production and Organizations - - - General
    • J00 - Labor and Demographic Economics - - General - - - General

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