One-way Flow Networks: the Role of Heterogeneity

Arbeitspapier

I study a one-way flow connections model in which players are heterogeneous with respect to values and the costs of establishing a link. I first show that values and costs asymmetries are crucial in determining the level of connectedness of a network. Interestingly, unconnected equilibria are asymmetric and central players may emerge. Second, I show that non-singleton components have a wheel architecture as far as the costs of linking are not partner specific. Otherwise also the flower architecture constitutes an equilibrium. I interpret these results as saying that asymmetric connections across players are a peculiar feature of homogeneous environments; by contrast, in heterogeneous settings players hold asymmetric connections, which are accompanied by the emergence of central players.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Tinbergen Institute Discussion Paper ; No. 04-031/1

Classification and Topics

• Classification: Wirtschaft ; Network Formation and Analysis: Theory ; Noncooperative Games
• Subject: Networks ; heterogeneity ; Netzwerk ; Spieltheorie ; Theorie ; Soziales Netzwerk

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Galeotti, Andrea
• Event: Veröffentlichung
• (who): Tinbergen Institute
• (where): Amsterdam and Rotterdam
• (when): 2004

Further information

• Handle: http://hdl.handle.net/10419/86399
• Last update: 10.03.2025, 11:42 AM CET