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Network Disruption and the Common Enemy Effect

  • B. Hoyer
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    "The enemy of my enemy is my friend." This common adage, which seems to be adhered to in social interactions (e.g. high school cliques or work relationships) as well as in political alliances within countries and between countries, describes the ability of groups or people to work together when they face an opponent, although otherwise they have little in common. In social psychology this phenomenon has been termed the "common enemy effect". Such group behavior can be studied using networks to depict the players within a group and the relationships between them. In this paper we study the effect of a common enemy on a model of network formation, where self-interested, myopic players can use links to build a network, knowing that they are facing a common enemy who can disrupt the links within the network and whose goal it is to minimize the overall value of the network. We find that introducing such a common enemy can lead to the formation of stable and efficient networks which would not be stable without the threat of disruption. However, we also find that fragmented networks as well as the empty networks are also stable. While the common enemy can thus have a positive effect on the incentives of players to form an efficient network, it can also lead to fragmentation and disintegration of the network.

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    File URL: http://dspace.library.uu.nl/bitstream/handle/1874/262523/12-06.pdf
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    Paper provided by Utrecht School of Economics in its series Working Papers with number 12-06.

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    Date of creation: 2012
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    Handle: RePEc:use:tkiwps:1206
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    1. Coralio Ballester & Antoni Calvó-Armengol & Yves Zenou, 2006. "Who's Who in Networks. Wanted: The Key Player," Econometrica, Econometric Society, vol. 74(5), pages 1403-1417, 09.
    2. Jean-Jacques, HERINGS & Ana, MAULEON & Vincent, VANNETELBOSCH, 2006. "Farsightedly stable networks," Discussion Papers (ECON - Département des Sciences Economiques) 2006046, Université catholique de Louvain, Département des Sciences Economiques.
    3. Satya P. Das & Prabal Roy Chowdhury, 2008. "Deterrence, preemption and panic: A Common-enemy problem of terrorism," Indian Statistical Institute, Planning Unit, New Delhi Discussion Papers 08-04, Indian Statistical Institute, New Delhi, India.
    4. Jackson, Matthew O. & Wolinsky, Asher, 1996. "A Strategic Model of Social and Economic Networks," Journal of Economic Theory, Elsevier, vol. 71(1), pages 44-74, October.
    5. Walter Enders & Paan Jindapon, 2010. "Network Externalities and the Structure of Terror Networks," Journal of Conflict Resolution, Peace Science Society (International), vol. 54(2), pages 262-280, April.
    6. Heski Bar-Isaac & Mariagiovanna Baccara, 2006. "How to Organize Crime," Working Papers 06-07, New York University, Leonard N. Stern School of Business, Department of Economics.
    7. Marco Mantovani & Georg Kirchsteiger & Ana Mauleon & Vincent Vannetelbosch, 2011. "Myopic or Farsighted? An Experiment on Network Formation," Working Papers 2011.45, Fondazione Eni Enrico Mattei.
    8. Venkatesh Bala & Sanjeev Goyal, 2000. "A Noncooperative Model of Network Formation," Econometrica, Econometric Society, vol. 68(5), pages 1181-1230, September.
    9. HERINGS, Jean-Jacques & MAULEON, Ana & VANNETELBOSCH, Vincent, . "Farsightedly stable networks," CORE Discussion Papers RP 2171, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    10. K.J.M. De Jaegher & B. Hoyer, 2010. "Strategic Network Disruption and Defense," Working Papers 10-13, Utrecht School of Economics.
    11. Dan Kovenock & Brian Roberson, 2010. "The Optimal Defense of Networks of Targets," Purdue University Economics Working Papers 1251, Purdue University, Department of Economics.
    12. Marco Mantovani & Georg Kirchsteiger & Ana Mauleon & Vincent Vannetelbosch, 2013. "Limited Farsightedness in Network Formation," Working Papers ECARES 2013/76051, ULB -- Universite Libre de Bruxelles.
    13. Mariagiovanna Baccara & Heski Bar-Isaac, 2008. "How to Organize Crime -super-1," Review of Economic Studies, Oxford University Press, vol. 75(4), pages 1039-1067.
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