From bilateral two-way to unilateral one-way flow link-formation

Norma Olaizola () and Federico Valenciano ()

SERIEs: Journal of the Spanish Economic Association, 2016, vol. 7, issue 2, No 3, 257-278

Abstract: Abstract We provide a model that allows for a transition between the simplest variation of two basic models of strategic network formation: Bala and Goyal’s one-way flow model without decay, where links can be unilaterally formed, and a version without decay of Jackson and Wolinsky’s connections model based on bilateral formation of links. In the transitional model introduced here, these two benchmark models appear as extreme cases. We study efficiency and Nash, strict Nash and pairwise Nash stability for the intermediate model. Dynamics are also discussed.

Keywords: Network formation; Unilateral link-formation; Bilateral link-formation; Efficiency; Stability; Dynamics (search for similar items in EconPapers)
JEL-codes: A14 C72 D85 (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1007/s13209-016-0142-9

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