Essays in Economic Networks
Abstract: Essay one: A Simple Application of the Independent Link Formation Model In the networks literature, the E-R model stands for a class of random graph models whose link formation between any two nodes is independent. Based on this assumption, I investigates an entry problem where the welfare of the entrant depends on specific modes of interaction upon entering an existing group of agents o... read moref heterogeneous types. First I characterize the one-step best strategies for the entrant under two different modes of interactions, collective approval and independent approval, and found that the latter deviates positively from the former. Then I consider the dynamic version of this problem where entry is allowed to extend to infinity. Even though the best strategies differ under two different modes of interactions when there is only one entrant, they coincide in the limit. Essay two: A Modified Connection Model In this essay, I study the efficiency and stability of a modified version of the social communication model introduced by Jackson and Wolinsky (1996). Inspired by empirical evidence on how having strong vs weak ties affects job matching and referral hiring, I introduce two types of links, a "strong link" and a "weak link", to the original model. I characterize the efficient and stable networks. Similar to previous findings, there does not always exist a stable network that is efficient. Furthermore, there exists efficient networks that are not stable, but such problems might be remedied by redistributing utility values among players.
Thesis (M.S.)--Tufts University, 2017.
Submitted to the Dept. of Economics.
Advisor: Yannis Ioannides.
Committee: Yannis Ioannides, and Marcelo Bianconi.
Keyword: Economics.read less