nep-net New Economics Papers
on Network Economics
Issue of 2010‒02‒05
three papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Knowledge diffusion and knowledge transfer: two sides of the medal By Klarl, Torben
  2. Understanding Interactions in Social Networks and Committees By Bhattacharjee, A.; Holly, S.
  3. Impacts of Personality on Herding in Financial Decision-Making By Baddeley, M.; Burke, C.; Schultz, W.; Tobler, T.

  1. By: Klarl, Torben
    Abstract: Understanding the way in which knowledge is technically produced and transferred, and how its diffusion path can be characterized is of fundamental importance for the performance of an economy. Although this fact seems to be plausible ex ante, the relevant literature so far has paid less attention investigating the microeconomic link between knowledge transfer and knowledge diffusion in a comprehensive approach. The aim of this paper is to highlight the link between knowledge transfer, knowledge diffusion and network effects in a stochastic environment, because the adoption decision of new knowledge should be treated as a stochastic event. For this reason, a new knowledge diffusion model in the line of Bass (1969) has been put forward, which integrates knowledge diffusion and knowledge transfer. The advantage of the proposed model is twofold. From a theoretical point of view, not only the so-called unimodal diffusion phenomena can be modelled, but also bimodal diffusion phenomena can be obtained. From an empirical point of view, the model which incorporates heteroscedastic errors and mean reverting behaviour can be theoretically estimated directly within a standard SUR context. --
    Keywords: Knowledge diffusion,knowledge transfer,SUR
    JEL: C50 C51 C61 D89
    Date: 2009
  2. By: Bhattacharjee, A.; Holly, S.
    Abstract: While much of the literature on cross section dependence has focused mainly on estimation of the regression coefficients in the underlying model, estimation and inferences on the magnitude and strength of spill-overs and interactions has been largely ignored. At the same time, such inferences are important in many applications, not least because they have structural interpretations and provide useful interpretation and structural explanation for the strength of any interactions. In this paper we propose GMM methods designed to uncover underlying (hidden) interactions in social networks and committees. Special attention is paid to the interval censored regression model. Our methods are applied to a study of committee decision making within the Bank of England’s monetary policy committee.
    Keywords: Committee decision making; Social networks; Cross section and spatial interaction; Generalised method of moments; Censored regression model; Expectation-Maximisation Algorithm; Monetary policy; Interest rates
    JEL: D71 D85 E43 E52 C31 C34
    Date: 2010–01–22
  3. By: Baddeley, M.; Burke, C.; Schultz, W.; Tobler, T.
    Abstract: Experimental analyses have identified significant tendencies for individuals to follow herd decisions, a finding which has been explained using Bayesian principles of statistical inference. This paper outlines the results from a herding task designed to extend these analyses. Empirically, we estimate logistic functions using panel fixed effect estimation techniques to quantify the impact of herd decisions on individuals‘ decisions about whether or not to buy a financial asset. We confirm that there are statistically significant propensities to herd and that social information about others‘ decisions has an impact on individuals‘ decisions. We extend these findings by identifying associations between herding propensities and individual characteristics such as gender, age and specific personality traits including impulsivity and venturesomeness.
    Keywords: herding, social influence, financial decision making, personality
    JEL: D81 C92 G14
    Date: 2010–01–22

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