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Waiting for my Neighbors

Author

Listed:
  • Sidartha Gordon

    (LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique)

  • Emeric Henry

    (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, CEPR - Center for Economic Policy Research)

  • Pauli Murto

    (Aalto University)

Abstract

We introduce a neighborhood structure in a waiting game, where the payoff of stopping increases each time a neighbor stops. We show that the dynamic evolution of the network depends on initial parameters and can take the form of either a shrinking network, where players at the edges stop first, or a fragmenting network where interior players stop first. We find that, in addition to the coordination inefficiency standard in waiting games, the neighborhood structure gives rise to two other inefficiencies, the first linked to the order of exit and the second to the final distribution of remaining nodes.

Suggested Citation

  • Sidartha Gordon & Emeric Henry & Pauli Murto, 2018. "Waiting for my Neighbors," Sciences Po Economics Discussion Papers hal-03393125, HAL.
    • Handle: RePEc:hal:wpspec:hal-03393125
    Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-03393125v1
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    References listed on IDEAS

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    2. Gary Biglaiser & Jacques Crémer & André Veiga, 2020. "Migration between Platforms," CESifo Working Paper Series 8185, CESifo.
    3. Guang Tian & Xiaoxue Du & Fangbin Qiao & Andres Trujillo-Barrera, 2021. "Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China," JRFM, MDPI, vol. 14(11), pages 1-13, November.
    4. Jacques Crémer & Gary Biglaiser & André Veiga, 2022. "Should I stay or should I go? Migrating away from an incumbent platform," Post-Print hal-03792918, HAL.
    5. Crémer, Jacques & Biglaiser, Gary & Veiga, André, 2022. "Should I stay or should I go? Migrating away from an incumbent platform," TSE Working Papers 21-1281, Toulouse School of Economics (TSE).
    6. Biglaiser, Gary & Crémer, Jacques & Veiga, Andre, 2022. "Should I stay or should I go? Migrating away from an incumbent platform," CEPR Discussion Papers 14496, C.E.P.R. Discussion Papers.

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    Keywords

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    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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