Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/71936
Authors: 
Feri, Francesco
Year of Publication: 
2007
Series/Report no.: 
Working Papers in Economics and Statistics 2007-14
Abstract: 
This paper considers a model of economic network characterized by an endogenous architecture and frictions in the relations among agents as described in Bala and Goyal (2000). We propose a similar network model with the difference that frictions in the relations among agents are endogenous. Frictions are modeled as dependent on the result of a coordination game, played by every pair of directly linked agents and characterized by 2 equilibria: one efficient and the other risk dominant. The model has a multiplicity of equilibria and we produce a characterization of those are stochastically stable.
Subjects: 
network
decay
strategical interaction
JEL: 
A14
D20
J00
Document Type: 
Working Paper

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