nep-net New Economics Papers
on Network Economics
Issue of 2009‒01‒24
four papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. The effects of Procedures on Social Interaction: A Literature Review By Vanessa Mertins
  2. Structure of Business Firm Networks and Scale-Free Models. By Maksim Kitsak; Massimo Riccaboni; Shlomo Havlin; Fabio Pammolli; H. Eugene Stanley
  3. Scope, Strategy and Structure: The Dynamics of Knowledge Networks in Medicine By Consoli, Davide; Ramlogan, Ronnie
  4. Follow the Leader: Steady State Analysis of a Dynamic Social Network By David Goldbaum

  1. By: Vanessa Mertins (Institute for Labour Law and Industrial Relations in the EC, University of Trier)
    Abstract: While economists have neglected procedures for a long time, other social scientists early established a substantial research program. By now, there exists a large gap between a sheer bulk of empirical, experimental, and theoretical studies by non-economists and the fact that there is hardly any economic research on procedures. We argue that due to clear evidence for procedures in uencing human decision-making, economists can not remain silent about procedural aspects of strategic interactions any longer. There is an important research agenda to be developed. This survey article is intended to discuss an important approach by which the standard economic model, which is based on consequentialist preferences, needs to be enriched: not only outcomes shape human behavior but also the way in which decisions are taken. Behavioral economics may serve as an important link. Its aim is to integrate insights of cognitive and social psychologists as well as experimental economists with neoclassical economic theory. We argue that experimental economics should increase its efforts to identify procedural effects and that these experiments should be more incorporated in the theoretical literature as part of an ongoing dialogue between theorists and experimentalists. Among procedural aspects, procedural fairness suggests itself to become an integrative part. To highlight the need for rethinking the standard economic approach we review social science literature on procedural effects, with a special focus on experimental economics and inspired theory-building.
    Date: 2008–12
  2. By: Maksim Kitsak; Massimo Riccaboni; Shlomo Havlin; Fabio Pammolli; H. Eugene Stanley
    Abstract: We study the structure of business firm networks in the Life Sciences (LS) and the Information and Communication Technology (ICT) sectors. We analyze business firm networks and scale-free models with degree distribution P(q) proportional to (q + c)^-λ using the method of k-shell decomposition. We find that the LS network consists of three components: a "nucleus", which is a small well connected subgraph, "tendrils", which are small subgraphs consisting of small degree nodes connected exclusively to the nucleus, and a "bulk body" which consists of the majority of nodes. At the same time we do not observe the above structure in the ICT network. Our results suggest that the sizes of the nucleus and the tendrils decrease as λ increases and disappear for λ greater or equal to 3. We compare the k-shell structure of random scale-free model networks with the real world business firm networks. The observed behavior of the k-shell structure in the two industries is consistent with a recently proposed growth model that assumes the coexistence of both preferential and random regimes in the evolution of industry networks.
    Date: 2008–12
  3. By: Consoli, Davide; Ramlogan, Ronnie
    Abstract: The objective of this paper is to analyse the dynamics of networks in which new knowledge emerges and through which it is exchanged. Our conjecture is that the structure of a network cannot be divorced from the dynamics of the knowledge underpinning its activities. In so doing we look beyond studies based on the assumption of exogenous networks and delve into the mechanisms that stimulate their creation and transformation. In the first part the paper adopts a functional perspective and views networks as constructs aimed at the coordination of knowledge; accordingly, network structure is an emerging property that reflects the employment of an agreed strategy to achieve a collective scope. In the second part these themes are articulated in relation to the dynamics of medical innovation and enriched by an empirical study on the long-term evolution of medical research in Ophthalmology. This exercise highlights the connection between changes in scientific and practical knowledge and the reconfigurations of the epistemic network over a forty-year period. By mapping different network structures we capture variety in the gateways of knowledge creation – that is, the network participants – as well as in the pathways – that is, the inter-organisational collaborations. Our goal is to analyse how these patterns of interaction emerge and transform over time.
    Keywords: Innovation; Network analysis; Inter-organizational Relationships
    JEL: D83 O33 D85 O31
    Date: 2009–01–15
  4. By: David Goldbaum (School of Finance and Economics, University of Technology, Sydney)
    Abstract: A social pyramid is show to be the unique steady state social structure when agents gain utility from being early adopters of subsequently popular trends. The environment is related to a majority game, but introduces the importance of the timing of adoption. Utility derived from making a popular choice independent of timing is demonstrated as essential to support the hierarchy. The proposed environment is relevant to a number of settings in which leadership and timing of decisions are important or where being perceived as a trend setter is rewarded. The leadership position can be self-reinforcing. For a professional critic, for example, a cult-of personality can dictate popular tastes, such as in art, food, and wine markets. A social hierarchy can also apply to the introduction of new products or ideas including academic research and financial market analysts.
    Keywords: dynamic network; social interaction; consumer choice
    Date: 2009–01–01

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