STRUCTURAL HOMOPHILY

Homophily, or the fact that similar individuals tend to interact with each other, is a prominent feature of economic and social networks. I show that the equilibrium structure of homophily has empirical power. I build a strategic model of network formation, which produces a unique equilibrium network. Individuals have homophilic preferences and face capacity constraints on the number of links. I develop a novel empirical method, based on the shape of the equilibrium network, which allows for the identification and estimation of the underlying homophilic preferences. I apply this new methodology to the formation of friendship networks.     

Competition Between Networks: A Study of the Market for Yellow Pages

This paper estimates the importance of network effects in the market for Yellow Pages. I estimate three simultaneous equations: consumer demand for usage of a directory, advertiser demand for advertising and a publisher's first-order condition (derived from profit-maximizing behaviour). Estimation shows that advertisers value consumer usage and that consumers value advertising, implying a network effect. I find that internalizing network effects would significantly increase surplus. As an application, I consider whether the market benefits from monopoly (which takes advantage of network effects) or oligopoly (which reduces market power). I find that a more competitive market is preferable.     

SOCIAL INTERACTIONS IN LARGE NETWORKS: A GAME THEORETIC APPROACH

This article studies estimation of social interactions in a large network game, where all observations come from one single equilibrium of a network game with asymmetric information. Simple assumptions about the structure are made to establish the existence and uniqueness of the equilibrium. I show that the equilibrium strategies satisfy a network decaying dependence condition requiring that dependence between two players' decisions decay with their network distance, which serves as the basis for my statistical inference. Moreover, I establish identification and propose a computationally feasible and efficient estimation method, which is illustrated by an empirical application of college attendance.     

资产专用性、网络扩展和私人秩序

“公地悲剧”自哈丁提出以来 ,该名词成了揭示并批判公有产权的理论依据。可是 ,回眸现实 ,我们常听到网络、网络外部性 ,也常看到经济中的许多现象是公有产权 ,并且这些公有产权还在不断地扩展并呈繁荣之势。对此 ,理论上的解释是一个模糊的概念———网络外部性。本人对此提出自己的解释。通过自我实施的合约分析 ,我认为由于资产专用性的存在 ,个人进入网络投下不可收回的沉淀成本 ,由此构成可置信性承诺 ,通过私人秩序扩展了网络 ,实现了“公地繁荣”①。本文分为四部分 :第一部分提出观点 ;第二部分是私人秩序的博弈分析与论证 ,第三部分理论应用 ;最后归纳全文。     

NETWORK EXTERNALITIES AND COMPARATIVE ADVANTAGE

In this article, I examine how the network externalities of communications activities and trading opportunities interact to determine the structure of comparative advantage. These interactions are examined by constructing a two‐country, three‐sector model of trade involving a country‐specific communications network sector. The role of the connectivity of network providers, which allows users of a network to communicate with users of another network, is also explored.     

Online advertising networks and consumer perceptions of privacy

I use crowd-sourced ratings of website trustworthiness to investigate how consumers weigh the privacy impact of online advertising technologies. I find that using one additional advertising network is associated with a 0.7% increase in trust score and that using a behavioural network is associated with a 4.6% increase in trust score. These counter-intuitive results support the notion that consumers are unaware of the advertising technologies used by websites and their impact on privacy.     

Distributive politics of public goods networks through multistage voting

Public goods networks create conflict between districts needing the network and districts that pay the costs. Thus, it is difficult for pork barrel politicians to achieve logrolling with other districts. I show that logrolling is possible for such politicians if they set their agenda properly. To show this, I model the centralized decision‐making process as a multistage vote among representatives from different districts. I assume the districts are better off if and only if the public good “connects” them to the network. Public goods can be provided universally by setting the agenda properly, even when costs exceed the benefits.     

Asymmetric Regulation of Access and Price Discrimination in Telecommunications*

Suppose that a strong and a weak operator compete in a telecommunications market. To terminate a call operators need access to the competitor’s network if the call is off-net. Operators set two-part tariffs and price-discriminate according to termination of a call. Suppose as a benchmark that access prices are regulated at costs. I show that the weak operator’s profit and consumer welfare increase if the regulator sets a higher price to access the weak operator’s network. However, total surplus decreases even locally. *I received helpful comments from Mark Armstrong, Toker Doganoglu, Tommaso Valletti, Julian Wright, and, in particular, two referees and the editor Michael Crew. I gratefully acknowledge financial support from the Deutsche Forschungsgemeinschaft (Heisenberg Fellowship).     

双边平台形成机制初探——以ICT行业为例

双边平台的形成机制目前研究还不是很多,作为一种新经济下普遍存在的一种产业组织结构是如何从传统的组织结构演变过来的是很有意义的,本文通过对ICT行业操作系统平台和移动增值业务平台的案例分析认为双边平台的出现与产业价值链的模块化导致产业链演化为价值网,中心模块逐渐演化成为网络中的基础设施平台从而得出了"价值链-模块化价值网-系统平台"的演进过程,并且对于这种过程给予了经济学理论的解释和分析。     

空间视角下中国产学研协同创新网络演化研究

基于空间网络视角,利用联合专利数据刻画我国产学研协同创新网络演化特征。研究发现,随着产学研主体不断增加,创新网络逐渐覆盖全国,但区域创新联系呈现出创新中心区与非中心区非均衡性。由于空间网络关系的路径依赖越来越明显,技术知识传递的非对称性分布加剧,协同创新活动呈现创新中心区位锁定,导致网络协同创新效应难以形成,整体上协同创新网络重心呈“单核”向“三核”分布格局演化,国家创新系统长期依赖少数中心区域,中心区域技术知识辐射的局部效应与区域平衡发展的矛盾不断凸现。因此,应合理配置创新资源,优化协同创新网络空间形态,推进国家创新系统向均衡创新生态系统演化。     

Flexible network rules for identified externalities

I propose three modifications of Jackson's flexible network axiom (Jackson, 2005) when the structure of externalities across components have been identified. The first one takes into account the information about the externalities across components. The second one allows for coalitional deviations once the network has been formed. Finally, the third one tries to find a compromise with component efficiency (Myerson, 1977a).     

The edges of conflict and consensus: a case for creativity in regional forest policy in Southwest Finland

In this paper I articulate and describe how societal systems can be meaningfully integrated into development and environmental policy planning. I contrast two cases, the planning and implementation of the Natura 2000 reserve network and the Regional Forest Programme of Southwest Finland and discuss the elements that make the former process conflictual and the latter consensual. An analogy between ecosystem health and institutional health connects the vocabulary used in this paper with the vocabulary of environmental sciences and management. I describe the constituents of institutional health and discuss their importance in affording groups and individuals with power to resist, liabilities to resilience and capacity to adapt. I conclude by presenting a case for reform in development and environmental planning.     

Pricing flexibility under rate-of-return regulation: Effects on network infrastructure investment

When a commodity market relies upon a regulated network service industry—e.g., telecommunications, electricity, or natural gas transmission—economic efficiency in that commodity market is a crucial consideration for regulatory design. This is because insufficient infrastructure investment relative to network demand results in congestion. The extraction of associated rents has distortionary effects on commodity spot market prices. Greater regulatory flexibility in network pricing can alleviate such issues by cultivating the incentives needed for stakeholders to invest in transmission capacity. To illustrate this effect I derive and numerically solve stylized optimality conditions for access and usage prices for a gas pipeline operator under alternative regulatory models. My results have general implications for regulation in network infrastructure industries, as energy and telecommunications markets are expected to expand considerably over the coming decades.     

Market access and occupational upgrading: evidence from the 19th century American transportation network

This article investigates the extent to which county-level market access affects workers’ occupational upgrading and industrial sorting by exploiting the substantial spatial variation and rapid expansion of the United States’ transportation network coverage from 1870 to 1880. First, I find that individuals who enjoyed greater market access in 1880 were more likely to work in higher-paying occupations. Importantly, this result holds across all sectors of employment, for younger and older workers, and for migrants and non-migrants, suggesting that any market size effects on occupational upgrading were not specific to any one group. I also provide results showing that workers were more likely to switch industries within agriculture, but are less likely to do so from manufacturing or services. Finally, I find some evidence of changes to sectoral reallocation, principally away from agriculture, being associated with higher market access. My findings suggest that the expansion of the transportation network in played an important role in determining the type of work Americans performed in the nineteenth century.     

TECHNOLOGICAL PROGRESS UNDER LEARNING BY IMITATION*

I analyze technological progress when knowledge has a large tacit component so that transmission of knowledge takes place through direct personal imitation. It is shown that the rate of technological progress depends on the number of innovators in the same knowledge network. Assuming the diffusion of knowledge to mirror the geographical pattern of trade—the greater the trade between two sites, the greater the probability that technical knowledge flows between them—I show that a gradual expansion of trade causes a sudden rise in the rate of technological progress.     

Electricity provision and industrial development: Evidence from India

I investigate the effect of electricity provision on industrialization using a panel of Indian states for 1965-1984. To address the endogeneity of investment in electrification, I use the introduction of a new agricultural technology intensive in irrigation (the Green Revolution) as a natural experiment. As electric pumpsets are used to provide farmers with cheap irrigation water, I use the uneven availability of groundwater at the start of the Green Revolution to predict divergence in the expansion of the electricity network and, ultimately, to quantify the effect of electrification on industrial outcomes. I present a series of tests to show that the electrification channel remains the most important one among alternative explanations that could link groundwater availability to industrialization directly or indirectly. Results show that an increase in one standard deviation in the measure of electrification is associated with an increase of around 14% in manufacturing output for a state at the mean of the distribution.     

Communication in repeated network games with imperfect monitoring

I consider repeated games with private monitoring played on a network. Each player has a set of neighbors with whom he interacts: a player's payoff depends on his own and his neighbors' actions only. Monitoring is private and imperfect: each player observes his stage payoff but not the actions of his neighbors. Players can communicate costlessly at each stage: communication can be public, private or a mixture of both. Payoffs are assumed to be sensitive to unilateral deviations. First, for any network, a folk theorem holds if some Joint Pairwise Identifiability condition regarding payoff functions is satisfied. Second, a necessary and sufficient condition on the network topology for a folk theorem to hold for all payoff functions is that no two players have the same set of neighbors not counting each other.     

Occupational Segregation and the (Mis)allocation of Talent

In this paper, I study how occupational segregation affects the allocation of talent in a competitive labour market. I propose a model of occupational choice in which heterogeneous workers must rely on their social contacts to acquire job‐vacancy information. While occupational segregation implies benefits in terms of job‐finding probability, it also leads to allocative inefficiencies. Efficient and equilibrium outcomes differ due to a network externality that leads workers to segregate too little, and a pecuniary externality that leads workers to segregate too much. Which effect dominates depends on the elasticity of wages to changes in the degree of occupational segregation.     

Entry Invitations in a Market with Network Effects

Abstract

This paper reinvestigates the well-known claim by Economides (1996) that the network effects can lead a monopolist to give away its technology for free. This so-called ‘open’ strategy is likely to be adopted when marginal network effects are strong but not too strong relative to marginal price effects. Highly elastic demand and highly convex costs also increase the likelihood of such a strategy. I first study the case in which the post-entry market structure is of the Cournot type and later compare the results with the Stackelberg case.     

A folk theorem for repeated games played on a network

I consider repeated games on a network where players interact and communicate with their neighbors. At each stage, players choose actions and exchange private messages with their neighbors. The payoff of a player depends only on his own action and on the actions of his neighbors. At the end of each stage, a player is only informed of his payoff and of the messages he received from his neighbors. Payoffs are assumed to be sensitive to unilateral deviations. The main result is to establish a necessary and sufficient condition on the network for a Nash folk theorem to hold, for any such payoff function.