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on Network Economics |
| By: | Bourreau, Marc (Telecom ParisTech and CREST-LEI, Paris); Cambini, Carlo (Polytechnic University of Turin); Dogan, Pinar (Harvard University) |
| Abstract: | In this paper, we analyze the incentives of an incumbent and an entrant to migrate from an "old" technology to a "new" technology, and discuss how the terms of wholesale access affect this migration. We show that a higher access charge on the legacy network pushes the entrant firm to invest more, but has an ambiguous effect on the incumbent's investments, due to two conflicting effects: the wholesale revenue effect, and the business migration effect. If both the old and the new infrastructures are subject to ex-ante access regulation, we also find that the two access charges are positively correlated. |
| JEL: | L51 L96 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp11-029&r=net |
| By: | Bardey, David (University of Rosario (Bogota, Colombia) and Toulouse School of Economics); Cremer, Helmuth (Toulouse School of Economics (IDEI and GREMAQ-CNRS)); Lozachmeur, Jean-Marie (Toulouse School of Economics (IDEI and GREMAQ-CNRS)) |
| Abstract: | This paper uses a two-sided market model of hospital competition to study the implications of different remunerations schemes on the physicians side. The two-sided market approach is characterized by the concept of common network externality (CNE) introduced by Bardey et al. (2010). This type of externality occurs when occurs when both sides value, possibly with different intensities, the same network externality. We explicitly introduce e¤ort exerted by doctors. By increasing the number of medical acts (which involves a costly effort) the doctor can increase the quality of service offered to patients (over and above the level implied by the CNE). We fi rst consider pure salary, capitation or fee-for-service schemes. Then, we study schemes that mix fee-for-service with either salary or capitation payments. We show that salary schemes (either pure or in combination with fee-for-service) are more patient friendly than (pure or mixed) capitations schemes. This comparison is exactly reversed on the providersside. Quite surprisingly, patients always loose when a fee-for-service scheme is introduced (pure of mixed). This is true even though the fee-for-service is the only way to induce the providers to exert e¤ort and it holds whatever the patientsvaluation of this effort. In other words, the increase in quality brought about by the fee-for-service is more than compensated by the increase in fees faced by patients. |
| JEL: | D41 L11 L12 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:24903&r=net |
| By: | Benjamin M. Tabak; Marcelo Yoshio Takami; J. M. C. Rocha; Daniel O. Cajueiro |
| Abstract: | Recent literature has focused on the study of systemic risk in complex networks. It is clear now, after the crisis of 2008, that the aggregate behavior of the interaction among agents is not straightforward and it is very difficult to predict. Contributing to this debate, this paper shows that the directed clustering coefficient may be used as a measure of systemic risk in complex networks. Furthermore, using data from the Brazilian bank interbank network, we show that the directed clustering coefficient is negatively correlated with domestic interest rates. |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:bcb:wpaper:249&r=net |
| By: | Gebreeyesus, Mulu (UNU-MERIT); Mohnen, Pierre (UNU-MERIT, Maastricht University) |
| Abstract: | This study focuses on innovation in a cluster of informal shoemaking firms in Ethiopia - namely the Mercato footwear cluster. It examines how differently those firms are embedded in networks and how heterogeneous they are in absorptive capacity, and how this heterogeneity affects their innovation performance. Business interactions with buyers, suppliers and other producers are the major channels through which knowledge flows into the cluster. These business networks are mainly built on trust and long-term relationships and tend to be selective. The study reveals that despite homogeneity in social background the firms in the cluster behave and perform differently. Based on econometric analysis we document a positive and strong effect of local network position and absorptive capacity on innovation performance. |
| Keywords: | industrial clusters, networks, innovation performance, informal sector, Africa, Ethiopia |
| JEL: | O17 O31 O33 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2011043&r=net |
| By: | Shriver, Scott K. (Columbia University); Nair, Harikesh S. (Stanford University); Hofstetter, Reto (University of St Gallen) |
| Abstract: | We use variation in wind speeds at surfing locations in Switzerland as exogenous shifters of users' propensity to post content about their surfing activity onto an online social network. We exploit this variation to test whether users' online content generation activity has a causal effect on their social ties. Under weak monotonicity assumptions, we also estimate nonparametric bounds on the causal effect of user's social ties in turn on their content generation activity. Economically significant causal effects of the type above can produce positive feedback that generates local network effects in content generation. We find evidence for such network effects. We argue this feedback generates a multiplier effect on interventions that subsidize tie formation. We use our estimates to measure the ROI from such interventions and discuss implications for the site's monetization strategy. Our empirical strategy provides one way to address a significant identification challenge with online social network data that the observed network structure is endogenous to the actions taken by agents on the network. Augmenting the model of agent's actions with a model for the network structure requires solving a formidable network formation game. Our approach to this problem is to conduct inference with an incomplete model of network formation under weak assumptions that deliver informative bounds on the causal effects of interest, while avoiding taking a strong stand on a specific model of network formation. |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:stabus:2083&r=net |
| By: | Lucio Carlos Friere-Gibb; Nielsen Kristian |
| Abstract: | The entrepreneurial dynamics of urban and rural areas are different, and this paper explores ’individual creativity’ and social network factors in both places. The probabilities of becoming an entrepreneur and of surviving are analyzed. The results are based on longitudinal data combined with a questionnaire, utilizing responses from 1,108 entrepreneurs and 420 non-entrepreneurs. Creativity is only found to be relevant for start-up in urban areas, but it does not influence survival in any of the two areas. The social network matters, in particular in rural areas. By combining the person and the environment, common entrepreneurship beliefs can be questioned and entrepreneurship theory benefited. |
| Keywords: | Entrepreneurship; Urban; Rural |
| JEL: | L26 O18 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:aal:abbswp:11-01&r=net |