 Network formation and disruption - An experiment are equilibrium networks too complex?Behnud Mir Djawadi, Angelika Endres, Britta Hoyer and Sonja Recker Journal of Economic Behavior & Organization, 2019, vol. 157, issue C, 708-734 Abstract: Models on network formation have often been extended to include the potential of network disruption in recent years. Whereas the theoretical research on network formation under the threat of disruption has thus gained prominence, hardly any experimental research exists so far. In this paper, we therefore experimentally study the emergence of networks including the aspect of a known external threat by relating theoretical predictions by Dzuibiński and Goyal (2013) to actual observed behaviour. We deal with the question if subjects in the role of a strategic Designer are able to form safe networks for least costs while facing a strategic Adversary who is going to attack their networks. Varying the costs for protecting nodes, we designed and tested two treatments with different predictions for the equilibrium network and investigated whether one of the least cost equilibrium networks was more likely to be reached. Furthermore, the influence of the subjects’ farsightedness on their decision-making process was elicited and analysed. Keywords: Networks; Experiment; Network design; Network defence; Network disruption (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:157:y:2019:i:c:p:708-734 DOI: 10.1016/j.jebo.2018.11.004 Access Statistics for this article Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D. More articles in Journal of Economic Behavior & Organization from Elsevier |
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