The best shot game applied to networks is a discrete model of many processes of contribution to local public goods. It generally has a wide multiplicity of equilibria that we refine through stochastic stability. We show that, depending on how we define perturbations – i.e., possible mistakes that agents make – we can obtain very different sets of stochastically stable states. In particular and ...

In the canonical network model, the connections model, only three specific network structures are generically efficient: complete, empty, and star networks. This renders many plausible network structures inefficient. We show that requiring robustness with respect to stochastic transmission failures rehabilitates incomplete, circular network structures. Specifically, we show that near the “bifur...

I examine a model in which two competing groups offer different allocation rules that may depend on the network of connections among the individuals that make up each group. I assume the existence of a single divisible good, such as a monetary prize, to be divided by each group. The probability of winning the prize will depend on the group sizes, but I examine a more general contest function as...

We consider strategic interaction on a network of heterogeneous long-term relationships. The bilateral relationships are independent of each other in terms of actions and realized payoffs, and we assume that information regarding outcomes is private to the two parties involved. In spite of this, the network can induce strategic interdependencies between relationships, which facilitate efficient...

We present a new approach for the empirical investigation of agglomeration patterns. We examine the clustering of manufacturing firms by identifying patterns of spatial network formation that deviate from randomly generated networks. Using firm-level panel data from Vietnam we calculate transitivity, a measure to determine the strength of clustering of manufacturing firms. We then test whether ...

This paper addresses the existence of Nash networks for the one-way flow model of Bala and Goyal (2000) in a number of different settings. We provide conditions for the existence of Nash networks in models where costs and values of links are heterogeneous and players obtain resources from others through the directed path between them. We find that costs of establishing links play a vital role i...

We study a model of multi-player communication. Privately informed decision makers have different preferences about the actions they take, and communicate to influence each others’ actions in their favor. We prove that the equilibrium capability of any player to send a truthful message to a set of players depends not only on the preference composition of those players, but also on the number of...

I examine a dynamic model of network formation in which individuals use reinforcement learning to choose their actions. Typically, economic models of network formation assume the entire network structure to be known to all individuals involved. The introduction of reinforcement learning allows us to relax this assumption. Q-learning is a reinforcement learning algorithm from the artificial inte...

The rise in online social networking has brought about a revolution in social relations. However, its effects on offline interactions and its implications for collective well-being are still not clear and are under-investigated. We study the ecology of online and offline interaction in an evolutionary game framework where individuals can adopt different strategies of socialization. Our main res...