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on Network Economics |
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Issue of 2019‒03‒25
three papers chosen by Pedro CL Souza Pontifícia Universidade Católica do Rio de Janeiro |
| By: | Johannes Boehm (Département d'économie); Jan Sonntag (Département d'économie) |
| Abstract: | This paper studies the prevalence of vertical market foreclosure using a novel dataset on U.S. and international buyer-seller relationships, and across a large range of industries. We find that relationships are more likely to break when suppliers vertically integrate with one of the buyers’ competitors than when they vertically integrate with an unrelated firm. This relationship holds also, among other things, when conditioning on mergers that follow exogenous downward pressure on the supplier’s stock prices, suggesting that reverse causality is unlikely to explain the result. In contrast, the relationship vanishes when using rumored or announced but not completed integration events. Firms experience a substantial drop in sales when one of their suppliers integrates with one of their competitors. This sales drop is mitigated if the firm has alternative suppliers in place. |
| Keywords: | Mergers and acquisitions; Market foreclosure; Vertical integration; Production networks |
| JEL: | L14 L42 |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpecon:info:hdl:2441/44gofgf80399mp5fq5q50vv5t6&r=all |
| By: | Sebastiano Della Lena (Department of Economics, University Of Venice Cà Foscari) |
| Abstract: | People are exposed to a constant flow of information about economic, social and political phenomena; nevertheless, misinformation is ubiquitous in the society. This paper studies the spread of misinformation in a social environment where agents receive new information each period and update their opinions taking into account both their experience and neighborhood's ones. I consider two types of misinformation: permanent and temporary. Permanent misinformation is modeled with the presence of stubborn agents in the network and produces long-run effects on the agents learning process. The distortion induced by stubborn agents in social learning depends on the “updating centrality”, a novel centrality measure that identifies the key agents of a social learning process, and generalizes the Katz-Bonacich measure. Conversely, temporary misinformation, represented by shocks of rumors or fake news, has only short-run effects on the opinion dynamics. Results rely on spectral graph theory and show that the consensus among agents is not always a sign of successful learning. In particular, the consensus time is increasing with respect to the “bottleneckedness” of the underlying network, while the learning time is decreasing with respect to agents' reliance on their private signals. |
| Keywords: | Opinion Dynamics in Networks, Non-Bayesian Social Learning, Stubborn Agents, Speed of Convergence |
| JEL: | D83 D85 D72 Z10 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2019:09&r=all |
| By: | Albert, Philipp (WZB Berlin); Kübler, Dorothea (WZB Berlin); Silva-Goncalves, Juliana (University of Sydney) |
| Abstract: | Ambition as the desire for personal achievement is an important driver of behavior. Using laboratory experiments, we study the role of social influence on ambition in two distinct domains of achievement, namely performance goals and task complexity. In the first case, participants set themselves a performance goal for a task they have to work on. The goal is associated with a proportional bonus that is added to a piece rate if the goal is reached. In the second case, they choose the complexity of the task, which is positively associated with the piece rate compensation and effort. In both cases we test whether observing peer choices influences own choices. We find strong evidence of peer effects on performance goals. In contrast, we find no support for peer effects on the choice of task complexity. |
| Keywords: | peer effects; ambition; goal setting; task difficulty; laboratory experiment; |
| JEL: | C91 D83 D91 I24 |
| Date: | 2019–03–18 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:148&r=all |