Stochastic Stability in Network with Decay
Date
01.01.2005
01.01.2005
Authors
Francesco Feri
JEL Code
A14,D20,J00
A14,D20,J00
Keywords:
Network,Decay,Strategical interaction
Network,Decay,Strategical interaction
Publisher
Climate Change and Sustainable Development
Climate Change and Sustainable Development
Editor
Carlo Carraro
Carlo Carraro
This paper considers a simple communication network characterized by an endogenous architecture and an imperfect transmission of information. We analyze the process of network formation in a dynamic framework where self – interested individuals can form or delete links and, occasionally, are doing mistakes. Then, using stochastic stability, we identify which network structures the formation process will converge to.