I just posted a new paper on multilateral matching in network economies on the game theory page. This paper is co-authored with Emiliya Lazarova (University of Birmingham) and Pieter Ruys (Tilburg University). This paper investigates a network economy in which economic agents are connected within a structure of value-generating relationships. Agents are assumed to be…
Category: Networks
Investigating network formation under mutual consent
It seems to me there is a lack of game-theoretic modelling of network formation under mutual consent in the relationship building process. To model such a process of mutual consent is rather difficult. The simplest model from the literature is Myerson’s network formation game in which all individuals announce which links they want to build….
New research on naive learning in networks
Together with Zhengzheng Pan I am working on how naive economic decision makers operate in complex, multi-layer network structures. In the updated paper that I posted on the game theory research page, we consider how decision makers interact in a network and at the same time observe other decision makers in a separate, but correlated…
Emperors of the network economy
This week news emerged that senior managers at large corporations (FTSE100) gave themselves an average pay rise of 55%. (Today there was a response by an executive that this pay rise was “only” 23%…) This followed earlier news that investment bankers have increased their bonuses to record levels as they face record profits. These tremendous…
Failure in the global relational economy
Yesterday, news broke that the SEC is accusing Goldman-Sachs of exploiting its middleman position for fraudulent purposes. This case is a striking example of what failures the relational or network structure of the global economy can cause without proper regulation and governance. In fact, this case has several important implications for our understanding of the global economy.
Trust in networks
Recently there has been a small surge in the economics literature addressing the role of trust in the economy. Experiments have shown that trust is extremely important for understanding economic processes. Trust does not fit very well with the traditional concept of “homo economicus”: Rational behavior is not trusting. The building and confirmation of trust…