Strong and Weak Links

Many of the interesting issues in the economics of networks-information transmission, individual incentives with local externalities, investments in connections, and the structure of complex networks-have to do with the quality of links between individuals entities. However, most of the research to date has assumed a one-zero formulation of connections. I argue that it is possible to write down tractable models of quality of links and that analyzing such models yields fresh insights into these issues. (JEL: C72, D85, Z13) Copyright (c) 2005 The European Economic Association.