We present a model of communication network formation in which links’ strengths are endogenously determined by individual incentives. Agents are endowed with a fixed amount of resource which they can distribute as they want in directed links. Individuals capture benefits from both direct and indirect access to others, in a way that takes into account the strength of each link. The wheel archite...

In a 2007 paper, “A global game with strategic substitutes and complements”, by Karp, L., I.H. Lee, and R. Mason, Games and Economic Behavior, 60(1), 155-175, an argument is made to show existence of Bayesian-Nash equilibrim in global games that may include both strategic substitutes and complements. This note documents a gap in the proof of that statement and presents an alternative proof for ...

We provide existence results in a game with local spillovers where the payoff function satisfies both convexity and the strategic substitutes property. We show that there always exists a stable pairwise network in this game, and provide a condition which ensures the existence of pairwise equilibrium networks. Moreover, our existence proof allows us to characterize a pairwise equilibrium of thes...

We provide existence results in a game with local spillovers where the payoff function satisfies both convexity and the strategic substitutes property. We show that there always exists a stable pairwise network in this game, and provide a condition which ensures the existence of pairwise equilibrium networks. Moreover, our existence proof allows us to characterize a pairwise equilibrium of thes...

In experimental games, we observe the following phenomena: (1) many subjects cooperate contrary to their material interest, (2) they cooperate in a reciprocal manner, (3) subjects often punish those others who behave unkindly, and (4) previous history usually influences subjects’ choices. We propose a simple game-theoretical model to account for these and other experimental phenomena, and compa...

We present a model of directed communication network with endogenous link strength. Agents are endowed with a fixed amount of resource which they can distribute over links. They obtain indirect benefit by the path maximizing the product of link strength. In this environment, the wheel architecture is shown to be not only the unique efficient architecture but also the unique Nash architecture. J...

This paper presents a toolkit for generating optimal policy projections. It makes five contributions. First, the requires minimal set of inputs: only baseline projection target and instrument variables impulse responses those to shocks. Second, it solves projections under commitment, limited-time discretion. Third, handles multiple instruments. Fourth, constraints on instruments such as lower b...

In addition to the common analysis of the Kauffman NK model where the value of K and the structure of interaction is given, the aim of this paper is to study what would be the values of these two parameters if they were endogenized. Thus, a model is proposed where firms and business schools coordinate to search for high peaks in their respective landscapes using evolutionary algorithms. The mai...

In this paper we study approximating the total loss associated with the individual insurance risk model by a compound Poisson random variable. By minimizing the expectation of the absolute deviation of the compound Poisson random variable from the true total loss, we investigate not only the optimal compound Poisson random variable but also the numerical calculation of the approximation error. ...