Myopic or Farsighted? An Experiment on Network Formation

Mantovani, Marco; Kirchsteiger, Georg; Mauleón, Ana; Vannetelbosch, Vincent J.

doi:10.2139/ssrn.1871709

Cited by 4 publications

(3 citation statements)

References 36 publications

(29 reference statements)

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“…Theoretical work on networks assuming farsightedness of players (see, e.g., the work by Morbitzer et al (2011), Morbitzer et al (2012 or Herings et al ( 2009)) establishes the concept of (perfect) farsighted stability, which would allow our players to escape the empty network. Laboratory experiments (see, e.g., the work by Mantovani et al (2011)) on the same topic show that players do tend to behave more farsightedly than myopically. At the same time, our negative commonenemy effect for small linking costs, where connected networks are pairwise stable with or without a disruptor, relies on the assumption that players are not always able to escape the empty network.…”

Section: Discussionmentioning

confidence: 99%

Network disruption and the common-enemy effect

Hoyer

Jaegher

2022

Int J Game Theory

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We study the effect of a common enemy on the connections-model of network formation, where self-interested players can use links to build a network, knowing that they face a common enemy who can disrupt the links or nodes of the network. The goal of the common enemy is to minimize the sum of the benefits players obtain from the network. We find that for large linking costs, introducing such a common enemy can lead to the formation of pairwise stable and efficient networks which would not be pairwise stable without the threat of disruption. The reason is the large reduction in payoffs caused by disruption as soon as one player fails to maintain a link. However, we also find that for small linking costs, the empty network is pairwise stable under disruption, whereas it is not in the absence of disruption. The reason is that in the presence of disruption a link that is unilaterally formed is automatically targeted (or one of the players forming the link is automatically targeted). While the common enemy can thus have a positive effect on the incentives of the players to form an efficient network, it can also lead to the disintegration of the network.

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Section: Discussionmentioning

confidence: 99%

Network disruption and the common-enemy effect

Hoyer

Jaegher

2022

Int J Game Theory

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“…We remark that our choice -which in principle yields a weaker equilibrium conceptmakes no actual difference if Assumption v0 is satisfied.11 The network concept of pair-wise stability is likewise myopic. On this seePage et al (2005) and discussion inMantovani et al (2011).…”

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confidence: 98%

Efficiency and Stability in a Process of Teams Formation

Boncinelli,

Muscillo,

2021

Preprint

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Motivated by data on coauthorships in scientific publications, we analyze a team formation process that generalizes matching models and network formation models, allowing for overlapping teams of heterogeneous size. We apply different notions of stability: myopic team-wise stability, which extends to our setup the concept of pair-wise stability, coalitional stability, where agents are perfectly rational and able to coordinate, and stochastic stability, where agents are myopic and errors occur with vanishing probability. We find that, in many cases, coalitional stability in no way refines myopic team-wise stability, while stochastically stable states are feasible states that maximize the overall number of activities performed by teams.

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“…The criteria are the following: gender, marital status, name of school or employer, sport, favorite dish, favorite music style, frequency of Facebook use, favorite journal and favorite movie.10 SeeMantovani et al (2011), Van Dolder and Buskens (2014) for experimental works andMorbitzer et al (2014) andHerings et al (2009) for theoretical works.…”

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confidence: 99%

The Effect of Sequentiality and Heterogeneity in Network Formation Games

Charroin

2016

SSRN Journal

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In the benchmark model of Bala and Goyal (2000) on network formation, the equilibrium network is asymmetric and unfair as agents have different payoffs. While they are prominent in reality, asymmetric networks do not emerge in the lab mainly because of fairness concerns. We extend this model with a sequential linking decision process to ease coordination and with heterogeneous agents. Heterogeneity is introduced with the presence of a special agent who has either a higher monetary value or a different status. The equilibrium is asymmetric and unfair. Our experimental results show that thanks to sequentiality and fairness concerns, individuals coordinate on fair and efficient networks in homogeneous settings. Heterogeneity impacts the network formation process by increasing the asymmetry of networks but does not decrease the level of fairness nor efficiency.

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Myopic or Farsighted? An Experiment on Network Formation

Cited by 4 publications

References 36 publications

Network disruption and the common-enemy effect

Network disruption and the common-enemy effect

Efficiency and Stability in a Process of Teams Formation

The Effect of Sequentiality and Heterogeneity in Network Formation Games

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