A non-cooperative model of network formation is developed. Agents form links with others based on the cost of the link and its assessed benefit. Link formation is one-sided, i.e., agents can initiate links with other agents without their consent, provided the agent forming the link makes the...

This paper studies a noncooperative model of network formation. Built upon the two-way flow model of Bala and Goyal (2000a), it assumes that information decay as it flows through each agent, and the decay is increasing and concave in the number of his links. This assumption results in the fact...