Sequential Network Design
Fuente:
arXiv
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| Auteurs principaux: | , , |
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| Format: | Preprint |
| Publié: |
2024
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| _version_ | 1866909921704935424 |
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| author | Sun, Yang Zhao, Wei Zhou, Junjie |
| author_facet | Sun, Yang Zhao, Wei Zhou, Junjie |
| contents | We study dynamic network formation from a centralized perspective. In each period, the social planner builds a single link to connect previously unlinked pairs. The social planner is forward-looking, with instantaneous utility monotonic in the aggregate number of walks of various lengths. We show that, forming a nested split graph at each period is optimal, regardless of the discount function. When the social planner is sufficiently myopic, it is optimal to form a quasi-complete graph at each period, which is unique up to permutation. This finding provides a micro-foundation for the quasi-complete graph, as it is formed under a greedy policy. We also investigate the robustness of these findings under non-linear best response functions and weighted networks. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2409_14136 |
| institution | arXiv |
| publishDate | 2024 |
| record_format | arxiv |
| spellingShingle | Sequential Network Design Sun, Yang Zhao, Wei Zhou, Junjie Theoretical Economics We study dynamic network formation from a centralized perspective. In each period, the social planner builds a single link to connect previously unlinked pairs. The social planner is forward-looking, with instantaneous utility monotonic in the aggregate number of walks of various lengths. We show that, forming a nested split graph at each period is optimal, regardless of the discount function. When the social planner is sufficiently myopic, it is optimal to form a quasi-complete graph at each period, which is unique up to permutation. This finding provides a micro-foundation for the quasi-complete graph, as it is formed under a greedy policy. We also investigate the robustness of these findings under non-linear best response functions and weighted networks. |
| title | Sequential Network Design |
| topic | Theoretical Economics |
| url | https://arxiv.org/abs/2409.14136 |