nep-net New Economics Papers
on Network Economics
Issue of 2013‒03‒23
six papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Broadband Networks and Open Access By OECD
  2. Optimal Transportation Network in a Closed City under Residential and Absentee Land Ownerships By Yuichiro Yoshida; Abu Nur Rashed Ahmed
  3. Optimal Market Size By Kei Kawakami
  4. Love me, love my dog: an experimental study on social connections and indirect reciprocity By Liang, Pinghan; Meng, Juanjuan
  5. Social Learning and Health Insurance Enrollment: Evidence from China's New Cooperative Medical Scheme By Liu, Hong; Sun, Qi; Zhao, Zhong
  6. Disentangling the relationship between nonprofit and social capital: the role of social cooperatives and social welfare associations in the development of networks of strong and weak ties By Giacomo, Degli Antoni; Fabio, Sabatini

  1. By: OECD
    Abstract: This report examines “open access” policies and approaches in various contexts, including fixed and mobile access networks, backhaul and backbone networks, undersea cables and Internet exchange points (IXPs). It finds that open access arrangements share some common elements: they refer to wholesale access to network infrastructure or services that is provided effectively on fair and reasonable terms, for which there is some degree of transparency and non-discrimination.
    Date: 2013–03–04
  2. By: Yuichiro Yoshida (National Graduate Institute for Policy Studies); Abu Nur Rashed Ahmed (National Graduate Institute for Policy Studies)
    Abstract: This paper investigates the optimality condition of transport network development in a closed city with residents’ and absentee land ownerships. We set up an urban land use model in which, taking prices and characteristics of transport network as given, households that are identical in their preferences and endowments maximize utility by choosing residential location, lot size, and travel modes. Social planner then optimizes with respect to the characteristics of transportation network so as to maximize the level of utility in the spatial equilibrium. The key findings of this paper include that under resident landlord case the general optimality condition of the transport network improvement is such that the marginal cost of improvement is equal to the marginal increase in the aggregated differential land rent evaluated at current level of land rent.
    Date: 2013–03
  3. By: Kei Kawakami
    Abstract: This paper studies endogenous market formation in a ?nancial trading model where strategic traders face information asymmetries and aggregate shocks. First, we show that negative participation externalities can arise for a large class of assets. In a decentralized process of market formation, the negative externalities limit competition between intermediaries. The model predicts that free entry into intermediation causes market fragmentation, but it is Pareto-superior to a single market. The model also predicts that the more intense the information asymmetry, the more a security tends to trade in fragmented markets.
    Keywords: Asymmetric information; Aggregate shock; Imperfect competition; Market fragmentation; Network externality puzzle
    Date: 2013
  4. By: Liang, Pinghan; Meng, Juanjuan
    Abstract: This paper conducts a laboratory experiment to investigate the role of social connections in behavioral indirect reciprocity. We provide the evidence of spillovers effects of social ties, e.g., the recipient’s indirect reciprocal act varies with the relations between the donor and a third party. Naturally occurring friendship is employed to study social connections. Thus, a beneficiary might either be a “friend” or a “stranger” of the donor. We demonstrate that knowing social connections significantly increases the recipient’s repayment only if the donor is kind enough in the first place. Overall, recipients’ indirect reciprocity almost doubles when introducing social networks among donors and beneficiaries. It is also shown that this spillovers effect is unlikely the result of recipients’ perception of donors’ expectations. Major theories of social preferences, e.g., fairness, intention-based, guilt-aversion, cannot offer satisfactory explanations of our findings. We propose an explanation based on in-group and out-group differences but with endogenous group status, in which social connections play a crucial role.
    Keywords: indirect reciprocity, social connections, spillovers, social preferences
    JEL: C91 D03 D85
    Date: 2013
  5. By: Liu, Hong (Central University of Finance and Economics); Sun, Qi (Shanghai University of Finance and Economics); Zhao, Zhong (Renmin University of China)
    Abstract: This paper examines the role of social learning in household enrollment decisions for the New Cooperative Medical Scheme in rural China by estimating a static game with incomplete information. Using a rich dataset from the China Health and Nutrition Survey, we find that the social network effects in the enrollment decision are large and significant. Furthermore, we use temporal and spatial proximity among household heads and obtain the result that the primary mechanism for the social network effects is social learning. Our findings indicate that a 10-percentage-point increase in the enrollment rate in a village increases one's take-up probability by 5 percentage points. We also find that the importance of social learning decreases significantly with the development of alternative information channels. Finally, the evidence suggests that healthier, wealthier, relatively well-educated older male household heads with Han nationality tend to be opinion leaders.
    Keywords: rural China, health insurance, social learning, social effect
    JEL: I1 G22
    Date: 2013–02
  6. By: Giacomo, Degli Antoni; Fabio, Sabatini
    Abstract: We use a unique dataset to study how participation in two specific types of nonprofit organizations, i.e. social welfare associations and social cooperatives, affects individual social capital. A descriptive analysis shows that both the types of organization have a positive impact. The econometric analysis reveals that social welfare associations play a significantly greater role in the development of volunteers’ networks of cooperative relationships, favouring the creation of weak ties which are used to exchange information and advice, and offering the opportunity to establish stronger ties entailing concrete mutual support. Within social cooperatives, workers develop their individual social capital to a greater extent than volunteers.
    Keywords: volunteering, nonprofit organizations, cooperative enterprises, social cooperatives, social capital, social networks
    JEL: L31 L33 P13 Z1
    Date: 2013–03–08

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