nep-net New Economics Papers
on Network Economics
Issue of 2011‒02‒12
seven papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Peer Effects, Fast Food Consumption and Adolescent Weight Gain By Bernard Fortin; Myra Yazbeck
  2. Mixing sets linked by bidirected paths By DI SUMMA, Marco; WOLSEY, Laurence
  3. Digital piracy : theory By BELLEFLAMME, Paul; PEITZ, Martin
  4. The Knowledge Base Evolution in Biotechnology: A Social Network Analysis. By Jackie Krafft; Francesco Quatraro; Pier-Paolo Saviotti
  5. Influence networks By LOPEZ-PINTADO, Dunia
  6. Governing a Common-Pool Resource in a Directed Network By Lionel Richefort; Patrick Point
  7. Stability and fairness in models with a multiple membership By LE BRETON, Michel; MORENO-TERNERO, Juan D.; SAVVATEEV, Alexei; WEBER, Shlomo

  1. By: Bernard Fortin; Myra Yazbeck
    Abstract: This paper aims at opening the black box of peer effects in adolescent weight gain. Using Add Health data on secondary schools in the U.S., we investigate whether these effects partly flow through the eating habits channel. Adolescents are assumed to interact through a friendship social network. We first propose a social interaction model of fast food consumption using a generalized spatial autoregressive approach. We exploit results by Bramoullé, Djebbari and Fortin (2009) which show that intransitive links within a network (i.e., a friend of one of my friends is not my friend) help identify peer effects. The model is estimated using maximum likelihood and generalized 2SLS strategies. We also estimate a panel dynamic weight gain production function relating an adolescent’s Body Mass Index (BMI) to his current fast food consumption and his lagged BMI level. Results show that there are positive significant peer effects in fast food consumption among adolescents belonging to a same friendship school network. The estimated social multiplier is 1.59. Our results also suggest that, at the network level, an extra day of weekly fast food restaurant visits increases BMI by 2.4%, when peer effects are taken into account.
    Keywords: Obesity, overweight, peer effects, social interactions, fast food, spatial models
    JEL: C31 I10 I12
    Date: 2011
  2. By: DI SUMMA, Marco (Dipartimento di Informatica, Università degli Studi di Torino, I-10149 Torino, Italy); WOLSEY, Laurence (Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium)
    Abstract: Recently there has been considerable research on simple mixed-integer sets, called mixing sets, and closely related sets arising in uncapacitated and constant capacity lot- sizing. This in turn has led to study of more general sets, called network-dual sets, for which it is possible to derive extended formulations whose projection gives the convex hull of the network-dual set. Unfortunately this formulation cannot be used (in general) to optimize in polynomial time. Furthermore the inequalities definining the convex hull of a network-dual set in the original space of variables are known only for some special cases. Here we study two new cases, in which the continuous variables of the network-dual set are linked by a bi- directed path. In the first case, which is motivated by lot-sizing problems with (lost) sales, we provide a description of the convex hull as the intersection of the convex hulls of 2^n mixing sets, where n is the number of continuous variables of the set. However optimization is polynomial as only n + 1 of the sets are required for any given objective function. In the second case, generalizing single arc flow sets, we describe again the convex hull as an intersection of an exponential number of mixing sets and also give a combinatorial polynomial-time separation algorithm.
    Keywords: mixing sets, extended formulations, mixed integer programming, lot-sizing with sales
    Date: 2010–10–01
  3. By: BELLEFLAMME, Paul (Université catholique de Louvain, CORE and Louvain School of Management, B-1348 Louvain-la-Neuve, Belgium); PEITZ, Martin (Department of Economics, University of Mannheim, D-68131 Mannheim, Germany)
    Abstract: This article reviews recent theoretical contributions on digital piracy. It starts by elaborating on the reasons for intellectual property protection, by reporting a few facts about copyright protection, and by examining reasons to become a digital pirate. Next, it provides an exploration of the consequences of digital piracy, using a base model and several extensions (with consumer sampling, network effects, and indirect appropriation). A closer look at market-structure implications of end-user piracy is then taken. After a brief review of commercial piracy, additional legal and private responses to end-user piracy are considered. Finally, a quick look at emerging new business models is taken.
    Keywords: information good, piracy, copyright, IP protection, internet, peer-to-peer, software, music
    JEL: L11 L82 L86
    Date: 2010–10–01
  4. By: Jackie Krafft (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR6227 - Université de Nice Sophia-Antipolis); Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR6227 - Université de Nice Sophia-Antipolis, Department of Economics, University of Turin - University of Turin); Pier-Paolo Saviotti (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR6227 - Université de Nice Sophia-Antipolis, GAEL - Grenoble Applied Economic laboratory - Aucune)
    Abstract: This paper applies the methodological tools typical of social network analysis (SNA) within an evolutionary framework, to investigate the knowledge base dynamics of the biotechnology sector. Knowledge is here considered a collective good represented as a co-relational and a retrieval-interpretative structure. The internal structure of knowledge is described as a network the nodes of which are small units within traces of knowledge, such as patent documents, connected by links determined by their joint utilisation. We used measures referring to the network, like density, and to its nodes, like degree, closeness and betweenness centrality, to provide a synthetic description of the structure of the knowledge base and of its evolution over time. Eventually, we compared such measures with more established properties of the knowledge base calculated on the basis of co-occurrences of technological classes within patent documents. Empirical results show the existence of interesting and meaningful relationships across the different measures, providing support for the use of SNA to study the evolution of the knowledge bases of industrial sectors and their lifecycles.
    Keywords: Knowledge Base, Social Network Analysis, Variety, Coherence, Industry lifecycles; exploration/exploitation
    Date: 2011
  5. By: LOPEZ-PINTADO, Dunia (Universidad Pablo de Olavide, Department of Economics, Sevilla, Spain; Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium)
    Abstract: Some behaviors, ideas or technologies spread and become persistent in society, whereas others vanish. This paper analyzes the role of social influence in determining such distinct collective outcomes. Agents are assumed to acquire information from others through a certain sampling process that generates an influence network, and they use simple rules to decide whether to adopt or not depending on the observed sample. We characterize, as a function of the primitives of the model, the diffusion threshold (i.e., the spreading rate above which the adoption of the new behavior becomes persistent in the population) and the endemic state (i.e., the fraction of adopters in the stationary state of the dynamics). We find that the new behavior will easily spread in the population if there is a high correlation between how influential (visible) and how easily influenced an agent is, which is determined by the sampling process and the adoption rule. We also analyze how the density and variance of the out-degree distribution affect the diffusion threshold and the endemic state.
    Keywords: social influence, networks, diffusion threshold, endemic state
    JEL: C73 L14
    Date: 2010–12–01
  6. By: Lionel Richefort (Nantes-Atlantic Economics and Management Laboratory (LEMNA), University of Nantes – IEMN); Patrick Point (Research Group on Theoretical and Applied Economics (GREThA),University of Bordeaux 4 – CNRS)
    Abstract: A local public-good game played on directed networks is analyzed. The model is motivated by one-way flows of hydrological influence between cities of a river basin that may shape the level of their contribution to the conservation of wetlands. It is shown that in many (but not all) directed networks, there exists an equilibrium, sometimes socially desirable, in which some stakeholders exert maximal effort and the others free ride. It is also shown that more directed links are not always better. Finally, the model is applied to the conservation of wetlands in the Gironde estuary (France).
    Keywords: Common-pool Resource, Digraph, Cycle, Independent Set, Empirical Example
    JEL: C72 D85 H41
    Date: 2010–11
  7. By: LE BRETON, Michel (Université de Toulouse 1, GREMAQ and IDEI, Toulouse, France); MORENO-TERNERO, Juan D. (Universidad de Malaga, Spain; Universidad Pablo de Olavide, Seville, Spain; Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium); SAVVATEEV, Alexei (New Economic School, Moscow, Russia); WEBER, Shlomo (Southern Methodist University, Dallas, USA and New Economic School, Moscow, Russia)
    Abstract: This article studies a model of coalition formation for the joint production (and finance) of public projects, in which agents may belong to multiple coalitions. We show that, if projects are divisible, there always exists a stable (secession-proof) structure, i.e., a structure in which no coalition would reject a proposed arrangement. When projects are in- divisible, stable allocations may fail to exist and, for those cases, we resort to the least core in order to estimate the degree of instability. We also examine the compatibility of stability and fairness on metric environments with indivisible projects. To do so, we explore, among other things, the performance of several well-known solutions (such as the Shapley value, the nucleolus, or the Dutta-Ray value) in these environments.
    Keywords: stability, fairness, membership, coalition formation
    JEL: C71
    Date: 2010–12–01

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