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Welfare Analysis in Games with substitutabilities


  • Yann Rébillé

    () (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - UN - Université de Nantes)

  • Lionel Richefort

    () (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - UN - Université de Nantes)


This paper investigates the social optimum in network games of strategic substitutes and identifies how network structure shapes optimal policies. First, we show that the socially optimal profile is ob-tained through a combination of two opposite network effects, generated by the incoming and the outgoing weighted Bonacich centrality measures. Next, three different policies that restore the social optimum are derived, and the implications of the predecessor(s)-successor(s) relationship between the agents on each policy instrument are explored. Then, the link between optimal taxes and the density of the network is established.

Suggested Citation

  • Yann Rébillé & Lionel Richefort, 2012. "Welfare Analysis in Games with substitutabilities," Working Papers hal-00732950, HAL.
  • Handle: RePEc:hal:wpaper:hal-00732950
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    References listed on IDEAS

    1. Ronan Le Velly & Vincent Bottois & Jean-Pierre Bréchet & Carole Chazoule & Moise Cornée & Sandrine Emin & Cécile Praly & Nathalie Schieb-Bienfait, 2010. "Comment se fait la rencontre entre offres et demandes locales pour la restauration collective publique ? Premiers enseignements," Post-Print halshs-00533183, HAL.
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    Cited by:

    1. Yann Rébillé & Lionel Richefort, 2015. "Influence and Social Tragedy in Networks," Revue d'économie politique, Dalloz, vol. 125(6), pages 811-833.
    2. repec:eee:gamebe:v:106:y:2017:i:c:p:329-342 is not listed on IDEAS
    3. Allouch, Nizar, 2017. "The cost of segregation in (social) networks," Games and Economic Behavior, Elsevier, vol. 106(C), pages 329-342.

    More about this item


    spectral radius; network game; social optimum; Bonacich centrality; opti- mal policy; spectral radius.;

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