In this paper, we study the formation of endogenous social storage cloud in a dynamic setting, where rational agents build their data backup connections strategically. We propose a degree-distance-based utility model, which is a combination of benefit and cost functions. The benefit function of...

Since the seminal contribution of Jackson & Wolinsky 1996 [A Strategic Model of Social and Economic Networks, JET 71, 44-74] it has been widely acknowledged that the formation of social networks exhibits a general conflict between individual strategic behavior and collective outcome. What has...

Compatibility of network products is an important issue in markets for communication technology as well as hard- and software products. Empirical findings suggest that firms competing in these markets typically choose intermediate degrees of product compatibility. We present a strategic...

Two sellers engage in price competition to attract buyers located on a network. The value of the good of either seller to any buyer depends on the number of neighbors on the network who consume the same good. For a generic specification of consumption externalities, we show that an equilibrium...

Two-sided market models in which platforms compete in two-part tariffs, i.e., a subscription and a per-transaction fee, are often plagued by a continuum of equilibria. This paper incorporates heterogeneous trading behavior of agents into the existing framework. We show that this natural and...

Daily-deal platforms have been in the spotlight in recent years. Originated from the group-buying selling strategy, these platforms have now shifted toward a business model that combines deep discount and advertising. We analyze the structure of daily-deal platforms from the two-sided market...

The Lightning Network is a decentralized payment network built on top of a block-chain, in which intermediary nodes provide a trust-less routing service for end users. We provide an overview of the current state of the network and show that it can be well approximated by a scale free generative...

Two firms engage in price competition to attract buyers located on a network. The value of the good of either firm to any buyer depends on the number of neighbors on the network who adopt the same good. When the size of externalities increases linearly with the number of adoptions, we identify...

I look at the equilibrium effects of homophily in network formation games having positive externalities. I show that very weak preferences for network effects (such as preference for being part of a clique) may result in very high levels of homophily at equilibrium. I present an empirical...