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A Dynamic Model of Network Formation

  • Alison Watts
Chapter
Part of the Studies in Economic Design book series (DESI)

Abstract

Network structure plays a significant role in determining the outcome of many important economic relationships; therefore it is crucial to know which network configurations will arise. We analyze the process of network formation in a dynamic framework, where self-interested individuals can form and sever links. We determine which network structures the formation process will converge to. This information allows us to determine whether or not the formation process will converge to an efficient network structure.

JEL Classification

A14 C7 D20 

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Copyright information

© Springer-Verlag Berlin Heidelberg 2003

Authors and Affiliations

  • Alison Watts
    • 1
  1. 1.Department of EconomicsVanderbilt UniversityNashvilleUSA

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