By design, the Bitcoin protocol has a low throughput. The Lightning Network (LN) is a layer-two solution built to increase throughput by cryptographically securing commitments to transactions and only occasionally converting cumulative balances into on-chain transactions. LN channels enable...

A large literature has studied how peers affect behavior by exploiting the preexisting social network structure only. What if networks rewire in response to changes in the economic environment, such as a randomized intervention? We exploit a unique panel dataset that contains detailed...

Networks may rewire in response to interventions. We propose a measure of the total treatment effect for those situations where an intervention may affect the network structure. To build this measure, we develop a treatment response model allowing for dynamic peer effects. We illustrate our...

The political blogosphere has recently been the focus of attention for social network analysis and applications of network and graph theory. In a recent paper, Adamic and Glance (2005) report differences between the linking behavior of politically conservative vs. politically liberal Web...

This paper studies an evolutionary model of network formation with endogenous decay, in which agents benefit both from direct and indirect connections. In addition to forming (costly) links, agents choose actions for a coordination game that determines the level of decay of each link. We address...

While DSGE models have been widely used by central banks for policy analysis, they seem to have been ineffective in calibrating the models for anticipating financial crises. To bring DSGE models closer to real situations, some of researchers have revised the traditional DSGE models. One of the...

Outward migration data from the Philippines exhibit spatial clustering. This is likely due to information spillover effects - fellow migrants share information with other neighboring migrants, thereby lowering the costs of migration. To verify this, we use spatial econometrics to define a...

A fundamental question in social sciences is how trust emerges. We provide an answer which relies on the formation of social and economic relationships. We argue that behind trust lies the fact that individuals invest in connections taking into account the potential externalities networks...

I study a one-way flow connections model in which players are heterogeneous with respect to values and the costs of establishing a link. I first show that values and costs asymmetries are crucial in determining the level of connectedness of a network. Interestingly, unconnected equilibria are...

Agents involved in the formation of a social or economic network typically face uncertainty about the benefits of creating a link. However, the interplay of such uncertainty and risk attitudes has been neglected in the network formation literature. We propose a dynamic network formation model...