nep-net New Economics Papers
on Network Economics
Issue of 2009‒05‒23
ten papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Social Capital and Network Externalities: Evidence from Gender Sensitive JFM Programme in West Bengal By Das, Nimai; Sarker, Debnarayan
  2. Regulatory Governance Costs in Network Industries: Implicatins for postal Regulation By Maegli, Martin; Jaag, Christian
  3. Innovation, spillovers, and university-industry collaboration: An extended knowledge production function approach By Roderik Ponds; Frank van Oort; Koen Frenken
  4. Centralizing information in networks. By Jeanne Hagenbach
  5. Strategic communication networks. By Jeanne Hagenbach; Frédéric Koessler
  6. Bargaining and Networks in a Gas Bilateral Oligopoly By Matteo M. Galizzi
  7. All-purpose minimal sufficient networks in the threshold game By Kris De Jaegher
  8. HedN Game, a Relational Framework for Network Based Cooperation By Franck Delaplace; Pierre Lescanne
  9. Managing Knowledge, Creating Networks and Triggering Innovations for Sustainable Agriculture By Anil K Gupta
  10. Three is a crowd - inefficient communication in the multi-player electronic mail game By Kris De Jaegher; Stephanie Rosenkranz

  1. By: Das, Nimai; Sarker, Debnarayan
    Abstract: This empirical exercise examines the impact of network externalities of social capital in a gender sensitive planning on Joint Forest Management Programme in West Bengal. One impact is that the pre-existing traditional characteristics of community solidarity, mutual trust and coordinated actions are the inner dynamic of the development for higher level social capital in JFM compared with non-JFM villages after JFM situation. The positive complementary effect of network externalities is also higher for the former villages. These two effects are more pronounced in women FPC villages in general and among very poor categories of households in particular within JFM villages.
    Keywords: Social capital; joint forest management villages; forest protection committee villages; productivity; equity; sustainability.
    JEL: Q23 A13 D78 J16
    Date: 2008
  2. By: Maegli, Martin; Jaag, Christian
    Abstract: The various actors in regulated industries relate to each other within a broader institutional framework, i.e. by way of formal and informal rules. An important role in the implementation of liberalization processes is given to the regulation and thus to regulatory institutions. Regulation should have positive effect on social welfare. But state intervention also causes costs which we call costs of regulatory governance. These costs result from negative consequences caused by unnecessary regulatory requirements or from the implementation of inappropriate regulatory instruments. According to new institutional economics, these costs will depend upon the formal and informal rules among the involved actors, upon the allocation of property rights among these actors, as well as upon the various principal-agent or more generally contractual relationships among these actors. In this article we define an analytical framework of costs of regulatory governance. We distinguish between direct and indirect costs of regulation: Direct costs occur in relation with the institutional design of the regulatory framework and the behavior of actors. Whereas the indirect costs arise because of false incentives and finally turn out in an inefficient supply of goods and services. Using the example of the Swiss postal market we give an outline of a possible application of the framework.
    Keywords: Regulation; Postal Sector; Regulatory Governance Costs; New Institutional Economics
    JEL: D23 L51 L87 K23 D61
    Date: 2009–04–27
  3. By: Roderik Ponds; Frank van Oort; Koen Frenken
    Abstract: This paper analyses the effect of knowledge spillovers from academic research on regional innovation. Spillovers are localized to the extent that the underlying mechanisms are geographically bounded. However, university-industry collaboration - as one of the carriers of knowledge spillovers - is not limited to the regional scale. Consequently, we expect spillovers to take place over longer distances. The effect of university-industry collaboration networks on knowledge spillovers is modelled using an extended knowledge production function framework applied to regions in the Netherlands. We find that the impact of academic research on regional innovation is mediated not only by geographical proximity but also by social networks stemming from collaboration networks.
    Keywords: knowledge production function, knowledge spillovers, university-industry collaboration, innovation, social networks
    JEL: C21 O18 O31 R11
    Date: 2009–02
  4. By: Jeanne Hagenbach (Centre d'Economie de la Sorbonne)
    Abstract: In the dynamic game we consider, players are the members of a fixed network. Everyone is initially endowed with an information item that he is the only paper to hold. Players are offered a finite number of periods to centralize the initially dispersed items in the hands of any one member of the network. In every period, each agent strategically chooses whether or not to transmit the items he holds to this neighbors in the network. The sooner all the items are gathered by any individual, the better it is for the group of players as a whole. Besides, the agent who first centralizes all the items is offered an additional reward that he keeps for himself. In this framework where information transmission is strategic and physically restricted, we provide a necessary and sufficient condition for a group to pool information items in every equilibrium. This condition is independent of the network structure. The architecture of links however affects the time needed before items are centralized in equilibrium. This paper provides theoretical support to Bonacich (1990)'s experimental results.
    Keywords: Social network, social dilemma, dynamic network game, strategic communication.
    JEL: D83 C72 L22
    Date: 2009–03
  5. By: Jeanne Hagenbach (Centre d'Economie de la Sorbonne); Frédéric Koessler (Paris-Jourdan Sciences Economiques (PSE))
    Abstract: We consider situations in which individuals would like to choose an action which is close to that of others, as well as close to a state of nature, with the ideal proximity to the state varying across agents. Before this coordination game is played, a cheap-talk communication stage is offered to the indivisuals who decide to whom they reveal their private information about the state. The information transmission occurring in the communication stage is characterized by a strategic communication network. We provide an explicit link between players' preferences and the equilibrium strategic communication networks. A key feature of our equilibrium characterization is that whether communication takes place between two agents not only depends on the conflict of interest between these agents, but also on the number and preferences of the other agents with whom they communicate. Apart from some specific cases, the equilibrium communication networks are quite complex despite our simple one-dimensional description of preference heterogeneity. In general, strategic communication networks cannot be completely Pareto-ranked, but expected social welfare always increases as the communication network expands.
    Keywords: Cheap talk, coordination, incomplete information, networks.
    JEL: C72 D82 D83 D85
    Date: 2009–02
  6. By: Matteo M. Galizzi
    Abstract: In the context of international gas markets, we investigate the interaction between price formation and communication networks in a bilateral duopoly with heterogeneous buyers. Given a particular buyers-sellers network graph, prices are formed as the outcome of dynamic decentralized negotiations among traders. We characterize, for any network structure, the full set of sub-game perfect Nash equilibria in pure and stationary strategies (PSSPNE) of the non-cooperative bargaining game with random order of proposals and simultaneous responses. Depending on the inter-temporal discount factor and the dispersion of reservation values across buyers, negotiations may lead, even in a completely connected buyers-sellers network, to multiple equilibria, co-existence of different prices, delays in trade and inefficient allocations. The endogenous bargaining power of each trader as a function of her position in the communication network is derived by comparing traders' payoffs across networks.
    Date: 2009
  7. By: Kris De Jaegher
    Abstract: This paper considers a multi-player stag hunt where players are either available for action or not, and where players additionally differ in their degree of conservatism, i.e. in the threshold of players that need to act along with them before they see benefits in collective action. Minimal sufficient networks, which depending on their thresholds allow players to achieve just enough interactive knowledge about each other's availability to act, take the form of hierarchies of cliques (Chwe, RES, 2000). We show that any typical threshold game has a plethora of such networks, so that players seem to face a large degree of strategic uncertainty over which network to use. The plethora of networks includes cases where the structure of the network infects players into acting more conservatively than is reflected in their thresholds. An extreme case of this is the core-periphery network, where each player acts as conservatively as the most conservative player in the population. Because of this feature, the core-periphery network is minimal sufficient for all possible populations. Players can thus solve the strategic uncertainty arising from the multiplicity of minimal sufficient networks by using the all-purpose core-periphery network.
    Keywords: Threshold Game, Common Knowledge, Network Formation, Collective Action.
    JEL: D82 D85 D71
    Date: 2009–04
  8. By: Franck Delaplace (IBISC - Informatique, Biologie Intégrative et Systèmes Complexes - CNRS : FRE3190 - Université d'Evry-Val d'Essonne); Pierre Lescanne (LIP - Laboratoire de l'Informatique du Parallélisme - INRIA - CNRS : UMR5668 - Université Claude Bernard - Lyon I - Ecole Normale Supérieure de Lyon - ENS Lyon)
    Abstract: This paper proposes a new framework for cooperative games based on mathematical relations. Here cooperation is defined as a supportive partnerships represented by a directed network between players (aka hedonic relation). We examine in a specific context, modeled by abstract games how a change of supports induces a modification of strategic interactions between players. Two levels of description are considered: the first one describes the support network formation whereas the second one models the strategic interactions between players. Both are described in a unified formalism, namely CP~game. Stability conditions are stated, emphasizing the connection between these two levels. We also stress the interaction between updates of supports and their impact on the evolution of the context.
    Keywords: Cooperative Game, Network, Stability, Hedonic Relation
    Date: 2009–05–15
  9. By: Anil K Gupta
    Abstract: "The paper discusses the major knowledge gaps, stress the importance of peer learning and building upon farmers’ own innovations and suggest new initiatives for transforming extension strategies. The author also argues that focus only on primary production in agricultural will not be viable in the long run. Value addition is necessary and extension for the purpose requires lot of action research. Village Knowledge Management Systems (VKMS) need to be developed for which a proposal has already been submitted to the Department of Science and Technology. An outline of the same is given in the paper to trigger further discussion. Farmers suicides in many states should have warranted a review of extension strategies much earlier. The proposed model aims to develop and monitor early warning signals of the socio ecological stress and recommend real time solutions.[IIMA- WP NO- 2009-03-05]"
    Keywords: knowledge management; horizontal knowledge networks;long term sustainability; Honey Bee Network; sustainable agriculture; natural resource management; private and common property rights institutions; non-monetary technologies; Knowledge gaps; National Centre for Integrated Pest Management; Transferring Science for Development and Diffusion of Dryland Technology; Newsweek; indicators of sustainability; Central Scientific Instruments Organization; micro level weather data
    Date: 2009
  10. By: Kris De Jaegher; Stephanie Rosenkranz
    Abstract: In a two-player stag hunt with asymmetric information, players may lock each other into requiring a large number of confirmations and confirmations of confirmations from one another before eventually acting. This intuition has been formalized in the electronic mail game (EMG). The literature provides extensions on the EMG that eliminate inefficient equilibria, suggesting that no formal rules are needed to prevent players from playing inefficiently. The present paper investigates whether these results extend to the multi-player EMG. We show that standard equilibrium refinements cannot eliminate inefficient equilibria. While two players are predicted to play efficiently, many players need formal rules telling them when who talks to whom.
    Keywords: Multi-Player Electronic Mail Game, Collective Action, Communication Networks
    JEL: D82 D85 D71
    Date: 2009–04

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