nep-net New Economics Papers
on Network Economics
Issue of 2007‒10‒06
five papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Games of Social Influence By Andrea Galeotti; Sanjeev Goyal
  2. Intellectual property rights and standard setting in financial services: the case of the Single European Payments Area By Robert M. Hunt; Samuli Simojoki; Tuomas Takalo
  3. Leaning an University Department: a life experiment By Carvalho, Pedro G.; Miragaia, Dina
  4. Behavioral foundation and agent-based simulation of regional innovation dynamics By Frank Beckenbach; Ramòn Briegel; Maria Daskalakis
  5. Inequality and Trust By Jordahl, Henrik

  1. By: Andrea Galeotti; Sanjeev Goyal
    Abstract: This paper considers a game played among players who seek to extract payoffs from a group of individuals subject to local interaction effects. We are interested in the relation between the network of social interaction and equilibrium actions and payoffs. We start with an analysis of two economic examples – strategic advertising in the presence of word of mouth advertising and social non-competitive marketing – to bring out the simple point that changing network connections can increase as well as decrease equilibrium actions and payoffs. This leads to an investigation of general conditions on payoffs under which equilibrium actions and payoffs increase/decrease with an increase in density of connections. We also develop conditions under which a greater dispersion in network connections leads unambiguously to positive and negative effects on actions as well as payoffs.
    Date: 2007–09–25
  2. By: Robert M. Hunt; Samuli Simojoki; Tuomas Takalo
    Abstract: For many reasons, payment systems are subject to strong network effects; one of those is the necessity of interoperability among participants. This is often accomplished via standard-setting organizations. The goal of the Single European Payments Area (SEPA) is to establish modern cross-boarder consumer payment systems for Europe. This too will require a standard-setting arrangement. But patents are also becoming an important feature of electronic payment systems and thus standard setting under SEPA should incorporate a policy to address the ownership and licensing of essential intellectual property. Using examples from the experience of European mobile telephony and financial patenting in the United States, the authors argue that the lack of a well-developed IP policy creates significant risks for participants in the new SEPA payment systems.
    Keywords: Intellectual property
    Date: 2007
  3. By: Carvalho, Pedro G.; Miragaia, Dina
    Abstract: The European Quality Assurance methodology is pushing hard Portuguese Universities so that they should improve their overall performance. Working at a Portuguese University more than a decade ago, one of the authors experienced several life cycles in different Departments and the experience acquired in foreign Universities (USA) teached him a couple of simple things in order to positively participate in this kind of processes. However, he found it quite difficult to apply his knowledge without other’s contribution, due to several endogenous and exogenous reasons, including age and generation viewpoints. Together with the second author we started to apply some theoretical new insights we were discussing together during her PhD research. The purpose of this paper is to describe the experiment we are in now, following a social network methodology used in my Economics PhD together with three theoretical influences we think are inter twinkled like the lean thinking, the value focus thinking and the complication in innovation diffusion processes. After a brief literature review we describe the basic pillars we used to achieve the main goal of improving performance in a young university department. Using some coaching and economic tools and knowledge, we were able to gather a group of different people – students, staff and teachers - deeply involved in our proposal methodology. Preliminary results are briefly identified, as much as further research challenges.
    Keywords: Lean thinking; quality improvement; social networks analysis; decision making; Portuguese Universities
    JEL: O22 H83 L23 H52
    Date: 2007–03–05
  4. By: Frank Beckenbach (Department of Economics, University of Kassel); Ramòn Briegel (Department of Economics, University of Kassel); Maria Daskalakis (Department of Economics, University of Kassel)
    Abstract: Starting from the observation that there exists a broad variety for the level as well as for the connectedness of innovation activities in a regional context, we try to figure out a behavioral approach for explaining such a variety. This approach is composed of (i)conceptual and theoretical reflections about the micro-foundation of innovation activities, (ii)an agent-based simulation model for these activities and (iii)empirical regional survey studies as a measuring rod for such an approach. Such a composition can fill the explanatory gap between external conditions for regional innovation activities on one side and the observable innovation outcome by specifying plausible internal conditions for novelty creating activities on the other side. Furthermore the emergence of regional innovation networks can be explained.
    Keywords: Regional Innovation Networks, Multi-Agent-System, Behavioral Economics, Evolutionary Economics
    Date: 2007–08
  5. By: Jordahl, Henrik (Research Institute of Industrial Economics (IFN))
    Abstract: This paper reviews the literature on economic inequality and trust. Cross-country studies, within-country studies, and experiments all suggest that economic inequality exerts a negative influence on trust. Four mechanisms are proposed to explain the negative relationship: social ties (or networks), inference on social relationships (to see inequality as a signal of untrustworthy behavior), conflicts over resources, and opportunity cost of time. Social ties receive the strongest empirical support, but there is also some evidence in favor of inference on social relationships. Conflicts over resources and opportunity cost of time are contradicted by important pieces of evidence.
    Keywords: Trust; Inequality; Social Capital; Social Ties; Networks
    JEL: C23 D31 Z13
    Date: 2007–08–21

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