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on Network Economics |
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Issue of 2017‒11‒19
five papers chosen by Pedro CL Souza Pontifícia Universidade Católica do Rio de Janeiro |
| By: | Kim, Jun Sung; Patacchini, Eleonora; Picard, Pierre M; Zenou, Yves |
| Abstract: | This paper studies social-tie formation when individuals care about the geographical location of other individuals. In our model, the intensity of social interactions can be chosen at the same time as friends. We characterize the equilibrium in terms of both social interactions and social capital (the value of social interactions offered by each agent) for a general distribution of individuals in the urban geographical space. We show that greater geographical dispersion decreases the incentives to socially interact. We also show that the equilibrium frequency of interactions is lower than the effcient one. Using a unique geo-coded dataset of friendship networks among adolescents in the United States, we estimate the model and validate that agents interact less than the social first best optimum. Our policy analysis suggests that, given the same cost, subsidizing social interactions yields a higher total welfare than subsidizing transportation costs. |
| Keywords: | policies.; Social interactions; urban economic |
| JEL: | R1 R23 Z13 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12432&r=net |
| By: | Kennedy, Patrick; Prat, Andrea |
| Abstract: | The media industry is unique in its ability to spread information that may influence the democratic process. This influence depends on where and how citizens get their political information. While previous research has examined news production and consumption on specific media platforms --- such as newspapers, television, or the Internet --- little is known about overall news consumption across platforms. To fill this gap, we use a model of media power and individual-level survey data on news consumption to estimate the potential electoral influence of major news organizations in 18 countries. Our analysis highlights three global patterns: high levels of concentration in media power, dominant rankings by television companies, and a link between socioeconomic inequality and information inequality. We also explore international differences in the role of public-service broadcasting. |
| Keywords: | inequality; media concentration; media power |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12426&r=net |
| By: | Bart H.H. Golsteyn; Arjan Non; Ulf Zölitz |
| Abstract: | This paper provides evidence of a novel facet of peer effects by showing how peer personality affects educational achievement. We exploit random assignment of students to university sections and find that students perform better in the presence of more persistent peers and more risk-averse peers. In particular, low-persistence students benefit from highly-persistent peers without devoting additional efforts to studying. However, highly-persistent students are not affected by the persistence of their peers. The personality peer effects that we document are distinct from other observable peer characteristics and suggest that the personality traits of peers causally affect human capital accumulation. |
| Keywords: | Personality, peer effects, non-cognitive skills |
| JEL: | I21 I24 J24 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:269&r=net |
| By: | Proto, Eugenio (DepartmentofEconomics,University of Warwick, CAGE and IZA); Sgroi, Daniel (Department of Economics, University of Warwick,CAGE and Nuffield College, University of Oxford); Mahnaz Nazneen, Mahnaz (Department of Economics, University of Warwick) |
| Abstract: | Existing research supports two opposing mechanisms through which positive mood might affect cooperation. Some studies have suggested that positive mood produces more altruistic, open and helpful behavior, fostering cooperation. However, there is contrasting research supporting the idea that positive mood produces more assertiveness and inward-orientation and reduced use of information, hampering cooperation. We find evidence that suggests the second hypothesis dominates when playing the repeated Prisoner's Dilemma. Players in an induced positive mood tend to cooperate less than players in a neutral mood setting. This holds regardless of uncertainty surrounding the number of repetitions or whether pre-play communication has taken place. This finding is consistent with a text analysis of the pre-play communication between players indicating that subjects in a more positive mood use more inward-oriented, more negative and less positive language. To the best of our knowledge we are the rst to use text analysis in pre-play communication. |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:1141&r=net |
| By: | Gupta, Abhimanyu; Kokas, Sotirios; Michaelides, Alexander |
| Abstract: | A large theoretical literature emphasizes the importance of financial networks, but empirical studies remain scarce. Due to overlapping bank portfolios, the syndicated loan market provides a natural setting to study financial networks. We exploit the tiered structure of syndicated loans to construct such a network and characterize quantitatively its evolution over time. A spatial autoregressive model provides an ideal methodological framework to estimate spillovers from this financial network to lending rates and quantities. We find that these spillovers are economically large, time-varying and can switch sign after major economic shocks. Moreover, we find that network complexity and uncertainty rise after a large negative shock. Counterfactual experiments confirm the quantitative importance of spillovers and network structure on lending rates and quantities and can be used to disentangle the effects arising from spillovers versus changes in network structure. |
| Keywords: | complexity.; cost of lending; Financial Networks; spatial autoregression; Spillovers; syndicated loan market |
| JEL: | G01 G21 L14 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12424&r=net |