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on Network Economics |
| By: | Thierry Pénard (University of Rennes 1, CREM CNRS UMR 6211 and IDEC); Mourad Zeroukhi (Foundation of the University of Rennes 1, CREM CNRS UMR 6211 and IDEC) |
| Abstract: | For many applications, open source software (OSS) can o¤er a high-quality alternative to proprietary software (e.g. Linux, Apache, Android,...). But even if OSS is usually free of charge, its installation and use require some skills. Should the government intervene to promote the di¤usion of OSS and provide some learning or nancial support to potential adopters? This paper examines whether public subsidies towards open source software is socially desirable and how the extent of compatibility between open source software and proprietary software can infuence the amount of subsidies. We consider a mixed duopoly model in which a proprietary software (PS) company competes with an open source software (OSS) community. Users are heterogeneous in their ability to use OSS, and their utility depends on the number of users who have adopted the same software or a compatible software (existence of network externalities). Four situations are distinguished: full compatibility between OSS and PS, full incompatibility, and one-way compatibility (either only OSS or PS is compatible). We show that if the government only takes care of consumer surplus, public subsidies are welfare-enhancing. But the optimal level of subsidies is larger with full compatibility and PS compatibility than full incompatibility and OSS compatibility. These results suggest that government policy towards OSS must be conditional to the degree of compatibility between PS and OSS. |
| Keywords: | Open source software, Public subsidy, Network compatibility |
| JEL: | L11 L15 L17 L38 |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:201339&r=net |
| By: | di Iasio, Giovanni; Battiston, Stefano; Infante, Luigi; Pierobon, Federico |
| Abstract: | We implement a novel method to detect systemically important financial institutions in a network. The method consists in a simple model of distress and losses redistribution derived from the interaction of banks' balance-sheets through bilateral exposures. The algorithm goes beyond the traditional default-cascade mechanism, according to which contagion propagates only through banks that actually default. We argue that even in the absence of other defaults, distressed-but-non-defaulting institutions transmit the contagion through channels other than solvency: weakness in their balance sheet reduces the value of their liabilities, thereby negatively affecting their interbank lenders even before a credit event occurs. In this paper, we apply the methodology to a unique dataset covering bilateral exposures among all Italian banks in the period 2008-2012. We find that the systemic impact of individual banks has decreased over time since 2008. The result can be traced back to decreasing volumes in the interbank market and to an intense recapitalization process. We show that the marginal effect of a bank's capital on its contribution to systemic risk in the network is considerably larger when interconnectedness is high (good times): this finding supports the regulatory work on counter-cyclical (macroprudential) capital buffers. |
| Keywords: | Systemic risk; interbank market; contagion; network; feedback centrality. |
| JEL: | C45 D85 G01 G21 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:52141&r=net |
| By: | Lena Tonzer |
| Abstract: | Recent events emphasize the role of cross-border linkages between banking systems in transmitting local developments across national borders. This paper analyzes whether international linkages in interbank markets affect the stability of interconnected banking systems and channel financial distress within a network consisting of banking systems of main advanced countries for the period 1993-2009. Methodologically, I use a spatial modelling approach to test for spillovers in cross-border interbank markets. The results suggest that foreign exposures in banking play a significant role in channelling banking risk: I find that countries which are linked through foreign borrowing or lending positions to more stable banking systems abroad are significantly affected by positive spillover effects. From a policy point of view, this implies that especially in stable times linkages in the banking system can be beneficial, while they have to be taken with caution in times of financial turmoil covering the whole system. |
| Keywords: | Financial contagion, financial integration, banking networks |
| JEL: | F21 F34 G21 O16 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:wsr:wpaper:y:2013:i:129&r=net |
| By: | Nomaler; Frenken; Heimeriks |
| Abstract: | Internationally co-authored papers are known to have more citation impact than nationally co-authored paper, on average. However, the question of whether there are systematic differences between pairs of collaborating countries in terms of the citation impact of their joint output, has remained unanswered. On the basis of all scientific papers published in 2000 and co-authored by two or more European countries, we show that citation impact increases with the geographical distance between the collaborating counties. |
| Keywords: | citation impact, collaborations, distance, country effects |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:uis:wpaper:1303&r=net |
| By: | Itay P. Fainmesser; Andrea Galeotti |
| Abstract: | The business model of companies such as Facebook, MySpace, and Twitter, relies on mon- etizing the information on the interactions and in uences of their users. How valuable is such information, and is its use benecial or detrimental for consumer welfare? We study these questions in a model where a monopoly sells a network good and may price discriminate using network information: information on consumers in uences and/or on consumers susceptibili- ties to influence. Our framework incorporates a rich set of market products, including goods characterized by global and local network effects. We derive results on the value of network information and determine under which conditions, relative to uniform price, consumer surplus increases. We demonstrate the applicability of our framework using survey data on various types of relationships. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:bro:econwp:2013-13&r=net |
| By: | Gong, Zheng; Tian, Feng; Xu, Boyan |
| Abstract: | We analyze a model in which agents’ decisions to enter or exit investments are influenced from their individual and external parties’ transaction histories. Actual investment outcomes are unknown to all participants until the end of decision periods, but outcomes do change depending on the number of participating players in the market and the market’s current state of condition. In this particular model, agents have access to external parties’ information from those who are within their specific social network. Our study of limited information aggregation mainly focuses on market responses to investors’ decisions of exiting the investment. With social structures complicating investment outcomes, we present a model that describes how markets can enter relatively stable statuses long enough for exiting participants to return, which brings the investment back to normal conditions. Our model also supports previous studies that limited information aggregation can cause the exogenous shock effect of global collapse. |
| Keywords: | Information aggregation, Social structure, Internet Externality, Simulation |
| JEL: | D83 D85 |
| Date: | 2013–12–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:52143&r=net |
| By: | Hottenrott, Hanna; Lopes-Bento, Cindy |
| Abstract: | This study shows for a large sample of R&D-active manufacturing firms over the period 2000-2009 that knowledge alliances have a positive effect on patenting in terms of both quantity and quality. However, when distinguishing between alliances that aim at joint creation of new knowledge and alliances that aim at the exchange of knowledge, results suggest that creation alliances lead to more valuable patents as they receive significantly more forward citations per patent. Knowledge exchange alliances, on the other hand, are associated with patent quantity, but not quality. -- |
| Keywords: | Knowledge Alliances,Patents,Innovation,R&D,Count Data Models |
| JEL: | O31 O32 O33 O34 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:dicedp:122&r=net |