Competition and networks of collaboration

Nikita Roketskiy ()

Theoretical Economics, 2018, vol. 13, issue 3

Abstract: I develop a model of collaboration between tournament participants in which agents collaborate in pairs, and an endogenous structure of collaboration is represented by a weighted network. The agents are forward-looking and capable of coordination; they value collaboration with others and higher tournament rankings. I use von Neumann-Morgenstern stable sets as a solution. I find stable networks in which agents collaborate only within exclusive groups. Both an absence of intergroup collaboration and excessive intragroup collaboration lead to inefficiency. I provide a necessary and sufficient condition for the stability of efficient outcomes in winner-takes-all tournaments. I show that the use of transfers does not repair efficiency.

Keywords: Network; collaboration; farsighted agent; stable set; tournament (search for similar items in EconPapers)
JEL-codes: D85 C71 (search for similar items in EconPapers)
Date: 2018-10-04
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Working Paper: Competition and Networks of Collaboration (2017)
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