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One-way Flow Networks: the Role of Heterogeneity

Galeotti, A (2004) One-way Flow Networks: the Role of Heterogeneity. UNSPECIFIED. Tinbergen Institute Discussion Papers 04-031/1.

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I study a one-way flow connections model in which players are heterogeneous with respect to values and the costs of establishing a link. I first show that values and costs asymmetries are crucial in determining the level of connectedness of a network. Interestingly, unconnected equilibria are asymmetric and central players may emerge. Second, I show that non-singleton components have a wheel architecture as far as the costs of linking are not partner specific. Otherwise also the flower architecture constitutes an equilibrium. I interpret these results as saying that asymmetric connections across players are a peculiar feature of homogeneous environments; by contrast, in heterogeneous settings players hold asymmetric connections, which are accompanied by the emergence of central players.

Item Type: Monograph (UNSPECIFIED)
Uncontrolled Keywords: Networks; heterogeneity
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences > Economics, Department of
Depositing User: Jim Jamieson
Date Deposited: 16 Jul 2012 14:39
Last Modified: 17 Aug 2017 18:10

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