nep-net New Economics Papers
on Network Economics
Issue of 2015‒08‒07
five papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Network Formation and Financial Fragility By Beteto Wegner, Danilo Lopomo
  2. Predicting changes in the output of OECD countries: An international network perspective By Lyocsa, Stefan
  3. Success factors of innovation networks: Lessons from agriculture in Flanders By Lambrecht, Evelien; Kühne, Bianka; Gellynck, Xavier
  4. Information Networks and Their Role in Threshold Public Goods Games: An Experimental Study By Kreitmair, Ursula W.; Banerjee, Simanti; Walker, James M.
  5. Identifying New Opportunities: Developing a Coordinated National Soil Moisture Network By Strobel, Michael

  1. By: Beteto Wegner, Danilo Lopomo
    Abstract: A tractable model of the formation of financial networks is developed, allowing the use of concepts from portfolio theory. The optimal financial network maximizes a Sharpe ratio defined for financial networks, whereas the equilibrium financial net- work emerges from banks bargaining over future proceeds of co-investment oppor- tunities. Measures of financial fragility, systemic risk and robustness are developed. The equilibrium financial network is shown to be the most connected and with the lowest level of financial fragility, whereas the optimal is the one least connected and with lowest exposure to systemic risk, being also the most robust financial network.
    Keywords: Government interventions, financial fragility, financial networks, sytemic risk, robustness, Financial Economics, G1, G2, G3,
    Date: 2014–05
  2. By: Lyocsa, Stefan
    Abstract: We use a simple linear regression framework to present evidence, that complex relationships between stock markets and economies may be used to predict changes in the output of 27 OECD countries. We construct new unidirectional return co-exceedance networks to account for complex relationships between stock market returns, and between real economic growths. Although there is heterogeneity between individual country level results, overall our data and analysis provides evidence that topological properties of our networks are useful for in-sample prediction of next quarter changes in the output.
    Keywords: harmonic centrality centralization networks co-exceedance economic growth
    JEL: E44 G15 O40
    Date: 2015–07–27
  3. By: Lambrecht, Evelien; Kühne, Bianka; Gellynck, Xavier
    Abstract: Innovation has been identified as a critical asset for SMEs to survive (Hitt et al., 2001; Lee et al., 2001). However, SMEs that need to improve their innovation process often lack the essential resources to innovate when relying solely on their in-house activities (Batterink et al., 2010). A large body of literature therefore highlights the role of external partnerships, or networks (Lazzarini et al., 2001; Pittaway et al., 2004; Sawhney et al., 2006). Despite the increasing number of studies focusing on the relationship between networking and innovation, there is still considerable ambiguity and debate within literature regarding appropriate network characteristics for successful innovations (Nieto and Santamaria, 2007; Pittaway et al., 2004). Furthermore, the existing studies focus mostly on high tech companies (Edquist 2006, van Galen 2008). The objective of our study is to gain insight into the network characteristics critical for successful innovations within the agricultural sector in Flanders. The study is based on interviews and focus group discussions with farmers and network coordinators active in Flanders. In total, 109 respondents were consulted. This research is based on four innovation characteristics which seem crucial for each innovation (Kanter, 1988). For each of these innovation characteristics, we investigated how networks could contribute, via their network characteristics. The results showed that networks serves as a net for knowledge about e.g. new technologies, or changing legislation in order that farmers are faster aware of developments. When farmers have multiple contacts, they have a higher chance to discover new things. Thereby, it is important that knowledge providers are part of the network and connected with the different actors, and not only provide their information to the farmers as an external actor. Also the face-to-face communication within a network is an essential issue. Furthermore, coalition can play a crucial role for some innovations, as a lot of farmers are not able to implement their idea because for example the retailer or research institute is not supportive or interested. If the farmers set up a self-initiated coalition, it can be easier to initiate the innovative idea. Fourth, it is important that individual actors from the agricultural system revisit their actual role. Successful innovation processes often originate in situations where creativity is not limited within one unit. Based on the findings, recommendations for farmers as well as network coordinators are formulated to increase the innovation capacity.
    Keywords: Innovation, Networks, Success factors, Agriculture, Flanders, Agribusiness,
    Date: 2015–05
  4. By: Kreitmair, Ursula W.; Banerjee, Simanti; Walker, James M.
    Abstract: In this study, we employ laboratory economic experiments to explore the role information networks play in the collective provision of threshold or provision point public goods. Threshold public goods are those for which a target or threshold level of funds must be raised to make provision possible or economically viable. Many public goods exhibit this characteristic as they may only be provided in discrete quantities. Thresholds or provision points are particularly relevant to environmental public goods, given non-linear ecological processes. In a broader context, the study of contribution behavior for threshold public goods also provides valuable insights into fundraising activities of both national and local profit and not-for-profit agencies, which typically involve provision points. On the basis of a 2x2 full factorial treatment design we test the following hypotheses: 1) Given LOW endowments, localized information will be less effective than full contribution information in meeting the provision point. 2) Given HIGH endowments local information will be as effective as full information to meet the threshold contribution level. 3) In cases where the threshold is met, group members are more likely to make identical contributions in the COMPLETE treatments than in the LOCAL treatments.
    Keywords: Experimental Economics, Behavioral Economics, Networks, Information, Environmental Economics and Policy, Institutional and Behavioral Economics, Public Economics,
    Date: 2015
  5. By: Strobel, Michael
    Keywords: Agricultural and Food Policy, Teaching/Communication/Extension/Profession,
    Date: 2015–02–20

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