efficient network maximizing social welfare, and find that the efficient graph is either empty, complete or shows a strong core … counterfactual analyses, taking into account that the network and production can dynamically adjust to shocks or policy interventions ….6%. Our study further reveals that when ignoring the network structure the impact of firm exit or mergers is significantly …

In this paper we introduce a stochastic network formation model where agents choose both actions and links. Neighbors … in the network benefit from each other's action levels through local complementarities and there exists a global …