Link formation in cooperative situations

Dutta, Bhaskar; Nouweland, Anne van den; Tijs, S.H.

doi:10.1007/s001820050070

Cited by 123 publications

(39 citation statements)

References 12 publications

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“…For winner‐takes‐all tournaments, this condition is equivalent to the prize in the tournament being sufficiently small. To the best of my knowledge, this result does not appear in the literature (with the notable exception of Dutta et al (); however, a similar observation in their paper is derived only for a three‐agent example, and it does not generalize).…”

Section: Introductionmentioning

confidence: 52%

Competition and networks of collaboration

Roketskiy

2018

Theoretical Economics

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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.

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Section: Introductionmentioning

confidence: 52%

Competition and networks of collaboration

Roketskiy

2018

Theoretical Economics

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“…Let

N = {1, 2, ..., N}

denote the set of ex ante symmetric players. We consider a link announcement game based on Dutta, van den Nouweland, and Tijs (). Each player

i \in N

makes an announcement of links given by the strategy

s_{i} = {(s_{i j})}_{j \neq i}

, where

s_{i j} = 1

when player i intends to form a link with j and

s_{i j} = 0

when no such link is intended.…”

Section: The Modelmentioning

confidence: 99%

Network Formation under Multiple Sources of Externalities

Joshi

Mahmud

2016

J Public Economic Theory

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The architecture of social and economic networks is often explained in terms of the externalities shaping the link‐forming incentives of players. We make two contributions to this literature. First, we bring into its ambit the linear‐quadratic utility model. Since players' utilities are now a function of their network centralities, this permits endogenizing their locational incentives in a network. Second, we show that the mode of transmission of externalities can be crucial in dictating the topology of equilibrium networks. We consider two alternative modes for channeling externalities. Both have the same primary source (direct links) but a different secondary source (global effects vs. indirect links). We characterize equilibrium networks for different positive–negative combinations of primary–secondary externalities for both modes. We show that the mode of transmission influences the equilibrium architecture when externalities from the primary source are positive; when these externalities are negative, the equilibrium network is empty.

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“…For other interesting strategic models of network formation we refer the reader to Aumann and Myerson (1989), Boorman (1975), Dutta et al (1995), Jackson and Wolinsky (1996) and Kranton and Minehart (2001). With respect to the problem of coalition formation in games, the main references are Bloch (1995), Kalai et al (1979), Ray and Vohra (1997), Yi (1997) and the survey (Bloch 1997).…”

Section: General Overviewmentioning

confidence: 99%

“…An important contribution to the study of group formation and cooperation in (Cournot) oligopolies is Goyal and Moraga-Gonzales (2001), inspired by works on strategic models of network formation such as Aumann and Myerson (1989), , Dutta et al (1995), Goyal and Joshi (2003), Jackson and Wolinsky (1996), Kranton and Minehart (2001). It studies the incentives for collaboration between horizontally related firms with two-sided link formation.…”

Section: Network Formation Through Pairwise Collaborative Linksmentioning

confidence: 99%