@techreport{Haller2003Nash,
abstract = {A non-cooperative model of network formation is developed. Agents form links with others based on the cost of the link and its assessed benefit. Link formation is one-sided, i.e., agents can initiate links with other agents without their consent, provided the agent forming the link makes the appropriate investment. Information flow is two-way. The model builds on the work of Bala and Goyal, but allows for agent heterogeneity. Whereas they permit links to fail with a certain common probability, in our model the probability of failure can be different for different links. We investigate Nash networks that exhibit connectedness and super-connectedness. We provide an explicit characterization of certain star networks. Efficiency and Pareto-optimality issues are discussed through examples. We explore alternative model specifications to address potential shortcomings.},
address = {Berlin},
author = {Hans Haller and Sudipta Sarangi},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {D83; D82; 330; Soziales Netzwerk; Informationsverbreitung; Nash-Gleichgewicht; Theorie},
language = {eng},
number = {337},
publisher = {Deutsches Institut f\"{u}r Wirtschaftsforschung (DIW)},
title = {Nash Networks with Heterogeneous Agents},
type = {DIW-Diskussionspapiere},
url = {http://hdl.handle.net/10419/18073},
year = {2003}
}
