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Tables of Contents for The Economics of Networks
Chapter/Section Title
Page #
Page Count
Foreword
i
2
Patrick Cohendet
Patrick Llerena
Hubat Stahn
Gisele Umbhauer
List of contributions
iii
 
Introduction
1
14
The economics of networks
1
1
Interaction structure: the role of asymmetries
2
4
Irreversibility, diversity and stability
6
3
Outline of the book
9
6
I Interaction and Macro-Structure: an Overview
15
132
1 Economies with Interacting Agents
17
36
1.1 Introduction
17
3
1.2 Global interaction -- static models with random matching
20
2
1.3 Static models with global stochastic interdependence
22
2
1.4 Global interaction -- dynamic stochastic evolution
24
3
1.5 Technological choice
27
3
1.6 Evolution in games
30
4
1.7 Local interaction: static models
34
1
1.8 The neighbourhood structure of an economy
35
3
1.9 Local interaction: dynamic models
38
4
1.10 Evolving networks
42
2
1.11 Conclusion
44
1
1.12 References
45
8
2 Spatial Interactions in Dynamic Decentralised Economies: a Review
53
40
2.1 Introduction
53
3
2.2 A basic model
56
3
2.2.1 Direct interactions in dynamic economies
56
1
2.2.2 Spatial economies and local interactions
57
2
2.3 Interaction structures with low flexibility
59
13
2.3.1 Markov random fields on integer lattices
60
4
2.3.2 Repeated games on graphs and lattices
64
4
2.3.3 Cellular automata
68
2
2.3.4 `Self-organised criticality' and asymmetric interactions
70
2
2.4 Interaction structures with high flexibility
72
5
2.4.1 Percolation theory
72
1
2.4.2 Stochastic graphs
73
2
2.4.3 Artificial economies
75
2
2.5 Sidde models' drawbacks and `open ended' environments
77
4
2.6 Conclusions
81
1
2.7 References
82
11
3 Network, Interactions between Economic Agents and Irreversibilities: the Case of the Choice among Competing Technologies
93
30
3.1 Introduction
93
2
3.2 Irreversibility on a network of non "localised" agents
95
9
3.2.1 General characteristics of adoption static models
95
1
3.2.2 General characteristics of adoption dynamic models
96
1
3.2.3 The basic model based on the polya urn scheme
97
1
3.2.4 Extensions of the basic model
98
1
3.2.5 Discussions on the behaviors of potential adopters in a network
99
5
3.3 Irreversibility on a network of "localized" agents
104
9
3.3.1 The model of percolation
105
4
3.3.2 Dynamic models of adoption with local influences
109
4
3.4 Conclusion
113
5
3.5 References
118
5
4 Rationality and Heterogeneity in Stochastic Aggregation Models
123
24
4.1 Introduction
124
3
4.2 The non-neutrality of interactions in economic analysis
127
3
4.3 The question of rationality
130
4
4.4 From the question of rationality to the question of heterogeneity
134
4
4.5 Modeling with statistical behavioral functions
138
3
4.6 Conclusion
141
1
4.7 References
142
5
II Local Interaction, Learning and Diversity
147
94
5 Networks Competition under Local Interaction and Behavioral Learning
149
18
5.1 Introduction
149
2
5.2 Variety, standardization and local interaction
151
6
5.2.1 The interaction structure and the game
152
2
5.2.2 Learning and adapting
154
1
5.2.3 The Learning and algorithm
154
3
5.3 Results: local interaction and coordination
157
6
5.3.1 Methodology
157
1
5.3.2 Exploration, path-dependency and the emergence of order
158
2
5.3.3 Learning, standardization and diversity
160
1
5.3.4 The pace of convergence and the emergence of spatial structure
161
2
5.4 Conclusion and implications
163
2
5.5 References
165
2
6 Can Neighborhood Protect Diversity
167
22
6.1 Introduction
167
1
6.2 Pure coordination games and evolutionary processes
168
4
6.3 Global approach
172
5
6.4 Local approach: learning process and diversity
177
3
6.5 Local approach: mutations and diversity
180
6
6.6 Conclusion
186
1
6.7 References
187
2
7 Interactions of Local Interactions: Localized Learning and Network Externalities
189
16
7.1 Introduction
189
2
7.2 The model
191
3
7.2.1 Firms' behavior
191
1
7.2.2 Firm and technology spaces and neighborhoods
192
2
7.3 Results: localized interactions and diversity
194
8
7.3.1 Set-up and methodology
194
1
7.3.2 Global effects of local interactions
195
2
7.3.3 Sorting out individual effects
197
1
7.3.4 Comparison of (G,1) with (3,0)
198
2
7.3.5 Long term spatial structures
200
2
7.4 Conclusion
202
1
7.5 References
203
2
8 Evolution of Cooperation with Local Interactions and Imitation
205
18
8.1 Introduction
205
1
8.2 The prisoner's dilemma game with local interactions and imitation
206
5
8.2.1 Basic assumptions of the model
206
2
8.2.2 The model
208
3
8.3 Stability of cooperation with conditional imitation
211
6
8.3.1 Parametrization of the model
211
1
8.3.2 Aggregate results of the simulations
212
2
8.3.3 Spatial configurations
214
3
8.4 Diffusion and stability of cooperation with pure imitation
217
4
8.4.1 Aggregate results of the simulations
217
2
8.4.2 Spatial configurations
219
2
8.5 Conclusion
221
1
8.6 References
221
2
9 On the Frontier: Structural Effects in a Diffusion Model based on Influence Matrixes
223
18
9.1 Introduction
223
1
9.2 The foundations of the basic model
224
3
9.3 Two kinds of structural effects
227
7
9.3.1 The one standard model
227
2
9.3.2 The two standards model
229
5
9.4 Numerical testing
234
3
9.4.1 Entropy and phase diagram
234
1
9.4.2 The homogeneous case
235
1
9.4.3 Rules for networks generation
236
1
9.4.4 Structural effects
236
1
9.5 Conclusion
237
1
9.6 References
238
3
III Behaviors, Externalities and the Emergence of Networks
241
 
10 Networks, Specialization and Trust
243
22
10.1 Information intensity and economic viability
243
5
10.2 Surplus creation mechanisms
248
2
10.3 Capital-intensity and mass production
250
2
10.4 Information-intensive production and specialization
252
3
10.5 Network incentives, agent interaction and technological learning
255
6
10.5.1 Incentives and compatibility
255
1
10.5.2 Priority, reciprocity, credit and trust
256
1
10.5.3 Sustainable differentiation revisited: risk sharing and specialization
257
2
10.5.4 Learning and appropriation
259
2
10.6 Conclusion
261
1
10.7 References
262
3
11 Network Externalities, Cost Functions and Standardization
265
18
11.1 Introduction
265
2
11.2 The model
267
1
11.3 Behaviors and equilibrium
267
2
11.4 The existence and uniqueness issues
269
4
11.5 Compatibility and total output: a counter-example
273
7
11.6 Conclusion
280
1
11.7 References
281
2
12 The Emergence of Network Organizations in Processes of Technological Choice: a Viability Approach
283
8
12.1 Introduction
283
1
12.2 The Network constraints
284
1
12.3 Influence matrices describing network organization
285
1
12.4 Organizational niches
286
1
12.5 How network organization evolves
286
1
12.6 Minimizing a static complexity index
287
1
12.7 Minimizing a dynamic complexity index
288
1
12.8 The lock-in property
288
1
12.9 Conclusion
288
1
12.10 References
289
2
13 Are more Informed Agents able to shatter Information Cascades in the Lab?
291
16
13.1 Introduction
291
2
13.2 The Bikhchandani, Hirshleifer and Welch specific model (BHW)
293
3
13.3 The Anderson and Holt experiment
296
2
13.4 Experimental design and theoretical predictions
298
3
13.5 Results
301
3
13.6 Conclusion
304
1
13.7 References
305
2
14 Information Externalities and Learning with Sequential Interactions
307
18
14.1 Introduction
308
1
14.2 The model
309
2
14.3 Equilibrium solutions
311
6
14.3.1 Endogenous timing with two technologies
311
3
14.3.2 Endogenous timing with one technology
314
2
14.3.3 Exogenous timing (with two technologies)
316
1
14.4 Efficiency of imitation
317
6
14.4.1 Average error probability
318
3
14.4.2 Expected social surplus
321
2
14.5 Conclusion
323
1
14.6 References
324
1
15 The Evolution of Imitation
325
 
15.1 Introduction
325
2
15.2 The basic model
327
5
15.3 Imitation as an evolutionary dynamics
332
5
15.4 Conclusion
337
2
15.5 References
339