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 …

communication or spillovers via the links between them. Linking decisions are based on network-dependent marginal payoff and a … the other agents in the network. Agents derive payoff from having access to the information of others through … network independent noise capturing exogenous idiosyncratic effects. Moreover, agents have a limited observation radius when …

economy. Our efficiency analysis further allows us to study the effect of competition on innovation in R&D intensive … portfolio of ideas that changes over time through innovations and knowledge spillovers between collaborating firms. The … destruction leading to the obsolescence of existing technologies. We quantify the innovation gains from collaborations, and show …

placing its data on others’ storage devices, given the prevailing data loss rate in the network. The cost function of an agent … captures the cost that the agent incurs to maintain links in the network. With this utility function, we analyze what network … exists a pairwise stable network, which is also efficient. We show that all pairwise stable networks are efficient, and hence …

This paper presents a model of local network effects in which agents connected by a social network each value the …-Nash equilibria of this network game are in monotone strategies, can be strictly Pareto-ranked based on a scalar neighbor … which the social network is an instance of a Poisson random graph, when it is a complete graph, a standard model of network …

own experimentation, so total information decreases with network density; we determine density thresholds below which … agents asymptotically learn the state. In contrast, agent welfare is single-peaked in network density, and achieves a second …