Networks of relations and Word-of-Mouth Communication

Lippert, Steffen; Spagnolo, Giancarlo

doi:10.1016/j.geb.2010.08.010

Cited by 74 publications

(38 citation statements)

References 54 publications

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“…A series of recent studies have provided detailed theories of exactly how structures of relationships might influence behavior, and which specific sorts of patterns in social networks we should be looking for in determining whether a society is well-adapted to fostering cooperative behaviors. In particular, there are several studies (Bloch, Genicot, and Ray (2008), Lippert andSpagnolo (2011), Jackson, Rodriguez-Barraquer andTan (2012), Miller (2012, 2013)) that have explored how having friends in common and other local clique structures can help enforce cooperative behavior.…”

Section: Micro Analyses: Clustering and Local Interaction Patternsmentioning

confidence: 99%

“…If instead, the setting is such that it takes a long time for one's friends to learn of misbheavior then it becomes difficult to provide incentives for individuals to behave according to some desired social norm. In an extreme case, networks that look more like trees can enable an individual to misbehave in some relationships, and never have that information come back to affect other relationships (Raub and Weesie (1990), Lippert and Spagnolo (2011), Miller (2012, 2013)). …”

Section: Micro Analyses: Clustering and Local Interaction Patternsmentioning

confidence: 99%

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The Economic Consequences of Social-Network Structure

Jackson

Rogers

Zénou

2017

Journal of Economic Literature

358

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We survey the literature on the economic consequences of the structure of social networks. We develop a taxonomy of 'macro' and 'micro' characteristics of social interaction networks and discuss both the theoretical and empirical findings concerning the role of those characteristics in determining learning, diffusion, decisions, and resulting behaviors. We also discuss the challenges of accounting for the endogeneity of networks in assessing the relationship between the patterns of interactions and behaviors.

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Section: Micro Analyses: Clustering and Local Interaction Patternsmentioning

confidence: 99%

Section: Micro Analyses: Clustering and Local Interaction Patternsmentioning

confidence: 99%

The Economic Consequences of Social-Network Structure

Jackson

Rogers

Zénou

2017

Journal of Economic Literature

358

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“…For a formal analysis of these issues, in the related literature on social punishment to sustain bilateral interactions between network insiders, Bloch et al (2008), Lippert and Spagnolo (2011), and Joshi and Mahmud (2016) all characterize stable network structures with explicit concern for sequential rationality.…”

Section: The Outsider Knows Insiders' Position In the Networkmentioning

confidence: 99%

Availability of Better Data on Communication Networks Can Undermine Community Enforcement

Campbell

2016

SSRN Journal

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I consider a repeated trust game played between a group of insiders, arranged in a network representing their lines of communication, and a single outsider. Insiders follow a local punishment rule, shunning the outsider if it has cheated them or a neighbor. The object of interest is that the outsider may know either summary statistics about the nature of the network, or know its precise non-anonymous structure. For the outsider to have knowledge of the precise structure may, depending on the shape of the network, increase or decrease the volume of honest interaction that can be sustained. In extreme cases, a small 'local' vulnerability to outside exploitation can result in a total breakdown of the chance for mutually beneficial trade across the whole network. Strategic ignorance and obfuscation of network structure may therefore be valuable to both sides, complicating the problem for a network operator seeking to monetize data on the network graph. I discuss recent decisions by Twitter and Facebook in this framework.

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“…More recent economics literature provides more rigorous theoretical underpinning (see also Raub and Weesie 1990, Haag and Lagunoff 2006, Ali and Miller 2012a, Mihm, Toth, and Lang 2009, Jackson, Rodriguez-Barraquer, and Tan 2011, and Lippert and Spagnolo 2011. On the other hand, seminal work by Burt (1992) suggests that social capital requires intermediaries that bridge across communities and facilitate interactions across otherwise disconnected individuals.…”

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confidence: 99%

Exclusive Intermediation

Fainmesser

2014

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. ABSTRACT. In this paper, we argue that an important function fulfilled by intermediaries is to facilitate trust by enabling social pressure towards the enforcement of informal agreements. To that end, we develop a new model that uses network theory to show that intermediaries who have exclusivity over a large enough number of interaction opportunities are able to exploit their position in the chains of interactions in the market to overcome incentive problems that would otherwise shut down the market. We derive conditions on the network structure under which intermediaries fulfill this function. Finally, we analyze two applications: (1) the market for short term apartment rentals; and (2) a financial market with investors and entrepreneurs. We provide additional examples suggesting that this paper uncovers an important channel through which intermediaries operate. Terms of use: Documents in EconStor may

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Networks of relations and Word-of-Mouth Communication

Cited by 74 publications

References 54 publications

The Economic Consequences of Social-Network Structure

The Economic Consequences of Social-Network Structure

Availability of Better Data on Communication Networks Can Undermine Community Enforcement

Exclusive Intermediation

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