Eight degrees of separation

Paolo Pin

Research in Economics, 2011, vol. 65, issue 3, 259-270

Abstract: We present a network formation game whose equilibria are undirected networks. Every connected couple contributes to the aggregate payoff by a fixed quantity, and the outcome is split between players according to the Myerson value allocation rule. This setup shows a wide multiplicity of non-empty equilibria, all of them connected. We show that the efficient equilibria of the game are either the empty network, or a network whose diameter does not exceed a threshold of 8 (i.e. there are no two nodes with a distance greater than 8).

Keywords: Network; formation; Myerson; value (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (3)

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Related works:
Working Paper: Eight Degrees of Separation (2006)
Working Paper: Eight Degrees of Separation (2006)
Working Paper: Eight degrees of separation (2006)
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