We design an experiment to study how agents make use of different pieces of information in the lab, depending on how many others have access to them and the strategic nature of interaction. Agents receive signals about a payoff relevant parameter, and the information structure is represented by a non directed network, whose nodes are agents and whose links represent sharing agreements. We compa...

In this paper we present a methodology of model-based calibration additional capital needed in an interconnected financial system to minimize potential contagion losses. Building on ideas from combinatorial optimization tailored controlling case complete information about interbank network, augment the model with three plausible types fire sale mechanisms. We then demonstrate power euro area ba...

The Formation of Migrant Networks This paper provides the first direct evidence on the determinants of link formation among immigrants in the host society. We use a purposely-designed survey on a representative sample of Sri Lankan immigrants living in Milan to study how migrants form social links among them and the extent to which this network provides them with material support along three di...

First a non-cooperative model of network formation is investigated where link formation is one-sided and information flow is two-way. For that model, the relationship between different notions of efficient networks is studied: Pareto optimal networks on the one hand and welfare maximizing networks on the other hand. Strategic network formation is compared with funding schemes for public goods. ...

We introduce a noncooperative multilateral bargaining model for a network-restricted environment, in which players can communicate only with their neighbors. Each player can strategically choose the bargaining partners among the neighbors and buy their communication links with upfront transfers. We characterize a condition on network structures for efficient equilibria: An efficient stationary ...

A finitely repeated multi-player prisoner’s dilemma game has a unique, defective Nash equilibrium when played in a fixed group or on a fixed network. This paper shows that, in contrast, cooperation can be achieved in a subgame-perfect Nash equilibrium of a finitely repeated prisoner’s dilemma game when played over an endogenously formed network. The following game is finitely repeated: in each ...

I present a model of observational learning with payoff interdependence. Agents, ordered in a sequence, receive private signals about an uncertain state of the world and sample previous actions. Unlike in standard models of observational learning, an agent’s payoff depends both on the state and on the actions of others. Agents want both to learn the state and to anticipate others’ play. As the ...

Heterogeneity in Nash networks with two-way flow can arise due to differences in the following four variables: (i) the value of information held by agents, (ii) the rate at which information decays or loses its value as it traverses the network, (iii) the probability with which a link transmits information, and (iv) the cost of forming a link. In this paper we show that heterogeneity plays an i...

The Role of Social Networks in Cultural Assimilation* We develop a model where, in the first stage, minority individuals have to decide whether or not they want to assimilate to the majority culture while, in the second stage, all individuals (both from the majority and the minority group) embedded in a network have to decide how much effort they exert in some activity (say education). We show ...

The Journal of Economic Literature codes classification system (JEL) published by the American Association (AEA) is de facto standard for research literature in economics. JEL used to classify articles, dissertations, books, book reviews, and working papers EconLit, a database maintained AEA. Over time, it has evolved extended with over 850 subclasses. This paper reviews history development sys...