On the emergence of scale-free production networks

Stanislao Gualdi () and Antoine Mandel
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Stanislao Gualdi: FiQuant - Chaire de finance quantitative - MICS - Mathématiques et Informatique pour la Complexité et les Systèmes - CentraleSupélec, MAS - Mathématiques Appliquées aux Systèmes - EA 4037 - Ecole Centrale Paris

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: Building upon the standard model of monopolistic competition on the market for intermediary goods, we propose a simple dynamical model of the formation of production networks. The model subsumes the standard general equilibrium approach and robustly reproduces key stylized facts of firms' demographics. Firms' growth rates are negatively correlated with size and follow a core double-exponential distribution followed by fat tails. Firms' size and production network are power-law distributed. These properties emerge because continuous inflow of new firms shifts away the model from a steady state to a disequilibrium regime in which firms get scaled according to their resistance to competitive forces.

Keywords: disequilibrium; Production network; Network formation; Scale-free networks; Firms demographics; distribution of firms' size; Zipf law; general equilibrium; monopolistic competition; Réseaux de production; formation des réseaux; démographie industrielle; distribution de la taille des entreprises; réseaux invariants d'échelle; loi de Zipf; équilibre général; compétition monopolistique; déséquilibre (search for similar items in EconPapers)
Date: 2015-07
New Economics Papers: this item is included in nep-com and nep-net
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01179134v1
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Citations: View citations in EconPapers (5)

Published in 2015

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Related works:
Journal Article: On the emergence of scale-free production networks (2016)
Working Paper: On the emergence of scale-free production networks (2016)
Working Paper: On the emergence of scale-free production networks (2016)
Working Paper: On the emergence of scale-free production networks (2016)
Working Paper: On the emergence of scale-free production networks (2016)
Working Paper: On the emergence of scale-free production networks (2015)
Working Paper: On the emergence of scale-free production networks (2015)
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