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Network Formation And Anti-Coordination Games

  • Dunia López-Pintado

    ()

    (Universidad de Alicante)

  • Fernando Vega Redondo

    (Instituto Valenciano de Investigaciones Económicas)

  • Sanjeev Goyal

    (Queen Mary, University of London)

  • Yann Bramoulle

    (Université de Toulouse)

We study a setting in which individual players choose their partners as well as a mode of behavior in 2 x 2 anti-coordination games -- games where a player's best response is to behave differently than the opponent. We characterize the nature of equilibrium networks as well as study the effects of network structure on individual behavior. Our analysis shows that both the network architecture and the induced behavior are crucially dependent on the value of the cost of forming links. In general, the equilibrium configurations are found to be neither unique nor efficient. This conclusion continues to hold if the population game is embedded in a standard evolutionary model of learning, since all equilibria turn out to be stochastically stable.

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File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-2002-25.pdf
File Function: Fisrt version / Primera version, 2002
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Paper provided by Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) in its series Working Papers. Serie AD with number 2002-25.

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Length: 48 pages
Date of creation: Dec 2002
Date of revision:
Publication status: Published by Ivie
Handle: RePEc:ivi:wpasad:2002-25
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  1. Young, H Peyton, 1993. "The Evolution of Conventions," Econometrica, Econometric Society, vol. 61(1), pages 57-84, January.
  2. Kandori, M. & Mailath, G.J., 1991. "Learning, Mutation, And Long Run Equilibria In Games," Papers 71, Princeton, Woodrow Wilson School - John M. Olin Program.
  3. repec:dgr:uvatin:20000093 is not listed on IDEAS
  4. Samuelson Larry, 1994. "Stochastic Stability in Games with Alternative Best Replies," Journal of Economic Theory, Elsevier, vol. 64(1), pages 35-65, October.
  5. Dutta, B. & van den Nouweland, C.G.A.M. & Tijs, S.H., 1998. "Link formation in cooperative situations," Other publications TiSEM fb302bdf-f6ab-4909-99d5-5, School of Economics and Management.
  6. Matthew O. Jackson & Alison Watts, 2000. "On the Formation of Interaction Networks in Social Coordination Games," Econometric Society World Congress 2000 Contributed Papers 0778, Econometric Society.
  7. Aderlini, L. & Ianni, A., 1993. "Path Dependence and Learning from Neighbours," Papers 186, Cambridge - Risk, Information & Quantity Signals.
  8. Sanjeev Goyal & Fernando Vega-Redondo, 2000. "Learning, Network Formation and Coordination," Econometric Society World Congress 2000 Contributed Papers 0113, Econometric Society.
  9. Ellison, Glenn, 1993. "Learning, Local Interaction, and Coordination," Econometrica, Econometric Society, vol. 61(5), pages 1047-71, September.
  10. Rachel E. Kranton & Deborah F. Minehart, 2001. "A Theory of Buyer-Seller Networks," American Economic Review, American Economic Association, vol. 91(3), pages 485-508, June.
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