Assortative matching with network spillovers

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Assortative matching with network spillovers. / Bjerre-nielsen, Andreas.

In: Journal of Economic Theory, Vol. 187, 105028, 01.05.2020.

Research output: Contribution to journal › Journal article › Research › peer-review

Harvard

Bjerre-nielsen, A 2020, 'Assortative matching with network spillovers', Journal of Economic Theory, vol. 187, 105028. https://doi.org/10.1016/j.jet.2020.105028

APA

Bjerre-nielsen, A. (2020). Assortative matching with network spillovers. Journal of Economic Theory, 187, [105028]. https://doi.org/10.1016/j.jet.2020.105028

Vancouver

Bjerre-nielsen A. Assortative matching with network spillovers. Journal of Economic Theory. 2020 May 1;187. 105028. https://doi.org/10.1016/j.jet.2020.105028

Author

Bjerre-nielsen, Andreas. / Assortative matching with network spillovers. In: Journal of Economic Theory. 2020 ; Vol. 187.

Bibtex

@article{d4f65a9b28574fefad8de28d57e72c4a,
title = "Assortative matching with network spillovers",
abstract = "This paper investigates endogenous network formation by heterogeneous agents. The agents' types determine the value of linking and we incorporate spillovers as utility from indirect connections. We provide sufficient conditions for a class of networks with sorting to be stable for low to moderate spillovers; with only two types these networks are the unique pairwise stable ones. We also show that this sorting is suboptimal for moderate to high spillovers despite otherwise obeying the conditions for sorting in Becker (1973). This shows that in our sorted networks a tension between stability and efficiency is present. We analyze a policy tool to mitigate suboptimal sorting.",
keywords = "Faculty of Social Sciences, Network formation, Under-connectivity, Assortative matching, Network externalities, One-sided matching",
author = "Andreas Bjerre-nielsen",
year = "2020",
month = may,
day = "1",
doi = "10.1016/j.jet.2020.105028",
language = "English",
volume = "187",
journal = "Journal of Economic Theory",
issn = "0022-0531",
publisher = "Academic Press",

}

RIS

TY - JOUR

T1 - Assortative matching with network spillovers

AU - Bjerre-nielsen, Andreas

PY - 2020/5/1

Y1 - 2020/5/1

N2 - This paper investigates endogenous network formation by heterogeneous agents. The agents' types determine the value of linking and we incorporate spillovers as utility from indirect connections. We provide sufficient conditions for a class of networks with sorting to be stable for low to moderate spillovers; with only two types these networks are the unique pairwise stable ones. We also show that this sorting is suboptimal for moderate to high spillovers despite otherwise obeying the conditions for sorting in Becker (1973). This shows that in our sorted networks a tension between stability and efficiency is present. We analyze a policy tool to mitigate suboptimal sorting.

AB - This paper investigates endogenous network formation by heterogeneous agents. The agents' types determine the value of linking and we incorporate spillovers as utility from indirect connections. We provide sufficient conditions for a class of networks with sorting to be stable for low to moderate spillovers; with only two types these networks are the unique pairwise stable ones. We also show that this sorting is suboptimal for moderate to high spillovers despite otherwise obeying the conditions for sorting in Becker (1973). This shows that in our sorted networks a tension between stability and efficiency is present. We analyze a policy tool to mitigate suboptimal sorting.

KW - Faculty of Social Sciences

KW - Network formation

KW - Under-connectivity

KW - Assortative matching

KW - Network externalities

KW - One-sided matching

U2 - 10.1016/j.jet.2020.105028

DO - 10.1016/j.jet.2020.105028

M3 - Journal article

VL - 187

JO - Journal of Economic Theory

JF - Journal of Economic Theory

SN - 0022-0531

M1 - 105028

ER -

ID: 241043376