Socioeconomic Networks with Long-Range Interactions

Rui Carvalho () and Giulia Iori ()
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Rui Carvalho: University College London

No 07/12, City University Economics Discussion Papers from Department of Economics, City University, London

Abstract: In well networked communities, information is often shared informally among an individual’s direct and indirect acquaintances. Here we study a modified version of a model previously proposed by Jackson and Wolinsky to account for communicating information and allocating goods in socioeconomic networks. The model defines a utility function of node i which is a weighted sum of contributions from all nodes accessible from i. First, we show that scale-free networks are more efficient than Poisson networks for the range of average degree typically found in real world networks. We then study an evolving network mechanism where new nodes attach to existing ones preferentially by utility. We find the presence of three regimes: scale-free (rich-get-richer), fit-get-rich, and Poisson degree distribution. The fit-get-rich regime is characterized by a decrease in average path length.

New Economics Papers: this item is included in nep-net, nep-soc and nep-upt
Date: 2007-06

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Persistent link: http://EconPapers.repec.org/RePEc:cty:dpaper:07/12

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