From bilateral two-way to unilateral one-way flow link-formation

• Norma Olaizola ^[1] ; Federico Valenciano ^[1]
  1. [1] Universidad del País Vasco/Euskal Herriko Unibertsitatea

     Universidad del País Vasco/Euskal Herriko Unibertsitatea

     Leioa, España

     
• Localización: SERIEs : Journal of the Spanish Economic Association, ISSN 1869-4195, Vol. 7, Nº. 2, 2016, págs. 257-278
• Idioma: inglés
• Enlaces
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• Resumen

  • We provide a model that allows for a transition between the simplest variation of two basic models of strategic network formation: Bala and Goyal’s one-way flow model without decay, where links can be unilaterally formed, and a version without decay of Jackson and Wolinsky’s connections model based on bilateral formation of links. In the transitional model introduced here, these two benchmark models appear as extreme cases. We study efficiency and Nash, strict Nash and pairwise Nash stability for the intermediate model. Dynamics are also discussed.