Journal of Economic Theory and Econometrics: Journal of the Korean Econometric Society
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Journal of Economic Theory and Econometrics
JETEM/계량경제학보/計量經濟學報/JKES
Journal of the Korean Econometric Society

On the Interaction between Player Heterogeneity and Partner Heterogeneity in Two-way Flow Strict Nash Networks

Vol.26, No.3, September , 15–34



  •   (Department of International Business, Keimyung University)

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Abstract  

This paper brings together analyses of two-way flow Strict Nash networks under exclusive player heterogeneity assumption and exclusive partner heterogeneity assumption studied by Galeotti et al. (2006) and Billand et al. (2011) respectively. We provide a proposition that generalizes the results of thesemodels by stating that: (i) StrictNash network consists of multiple non-empty components as in Galeotti et al. (2006), and (ii) each non-empty component is a branching or $B_i$ network as in Billand et al. (2011). This proposition requires that a restriction on link formation cost, which is called Uniform Partner Ranking, is satisfied.


Keywords
   Network Formation, Strict Nash Network, Two-way Flow Network, Branching Network, Agent Heterogeneity

JEL classification codes
   C72, D85
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