IDEAS home Printed from https://ideas.repec.org/a/eee/phsmap/v392y2013i21p5453-5460.html
   My bibliography  Save this article

An imperfect competition on scale-free networks

Author

Listed:
  • Konno, Tomohiko

Abstract

We study an imperfect quantity competition on networks that represent rivalry relationships among firms. We show that the more heterogeneous the underlying network is, the more the output and the price are. The output and the price on scale-free networks are counter-intuitively the same as those in the monopoly regardless of the number of rival firms. We also show that any inverse demand function represented by a network has the corresponding utility function, which justifies the inverse demand function.

Suggested Citation

  • Konno, Tomohiko, 2013. "An imperfect competition on scale-free networks," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 392(21), pages 5453-5460.
    • Handle: RePEc:eee:phsmap:v:392:y:2013:i:21:p:5453-5460
    DOI: 10.1016/j.physa.2013.06.017
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0378437113005153
    Download Restriction: Full text for ScienceDirect subscribers only. Journal offers the option of making the article available online on Science direct for a fee of $3,000
    File URL: https://libkey.io/10.1016/j.physa.2013.06.017?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Sanjeev Goyal, 2007. "Introduction to Connections: An Introduction to the Economics of Networks," Introductory Chapters, in: Connections: An Introduction to the Economics of Networks, Princeton University Press.
    2. Franklin Allen & Douglas Gale, 2000. "Financial Contagion," Journal of Political Economy, University of Chicago Press, vol. 108(1), pages 1-33, February.
    3. Jackson, Matthew O. & Wolinsky, Asher, 1996. "A Strategic Model of Social and Economic Networks," Journal of Economic Theory, Elsevier, vol. 71(1), pages 44-74, October.
    4. Francisco C. Santos & Marta D. Santos & Jorge M. Pacheco, 2008. "Social diversity promotes the emergence of cooperation in public goods games," Nature, Nature, vol. 454(7201), pages 213-216, July.
    5. Venkatesh Bala & Sanjeev Goyal, 2000. "A Noncooperative Model of Network Formation," Econometrica, Econometric Society, vol. 68(5), pages 1181-1230, September.
    6. Kosfeld Michael, 2004. "Economic Networks in the Laboratory: A Survey," Review of Network Economics, De Gruyter, vol. 3(1), pages 1-23, March.
    7. Hisashi Ohtsuki & Christoph Hauert & Erez Lieberman & Martin A. Nowak, 2006. "A simple rule for the evolution of cooperation on graphs and social networks," Nature, Nature, vol. 441(7092), pages 502-505, May.
    8. Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521674096, September.
    9. Antoni Calvó-Armengol & Matthew O. Jackson, 2004. "The Effects of Social Networks on Employment and Inequality," American Economic Review, American Economic Association, vol. 94(3), pages 426-454, June.
    10. Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521857406, September.
    11. Erez Lieberman & Christoph Hauert & Martin A. Nowak, 2005. "Evolutionary dynamics on graphs," Nature, Nature, vol. 433(7023), pages 312-316, January.
    12. Cassar, Alessandra, 2007. "Coordination and cooperation in local, random and small world networks: Experimental evidence," Games and Economic Behavior, Elsevier, vol. 58(2), pages 209-230, February.
    13. Bramoulle, Yann & Kranton, Rachel, 2007. "Public goods in networks," Journal of Economic Theory, Elsevier, vol. 135(1), pages 478-494, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dong, Gaogao & Tian, Lixin & Du, Ruijin & Fu, Min & Stanley, H. Eugene, 2014. "Analysis of percolation behaviors of clustered networks with partial support–dependence relations," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 394(C), pages 370-378.
    2. Konno, Tomohiko, 2016. "Knowledge spillover processes as complex networks," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 462(C), pages 1207-1214.
    3. Konno, Tomohiko, 2016. "Network effect of knowledge spillover: Scale-free networks stimulate R&D activities and accelerate economic growth," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 458(C), pages 157-167.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jackson, Matthew O. & Zenou, Yves, 2015. "Games on Networks," Handbook of Game Theory with Economic Applications,, Elsevier.
    2. Syngjoo Choi & Edoardo Gallo & Shachar Kariv, 2015. "Networks in the laboratory," Cambridge Working Papers in Economics 1551, Faculty of Economics, University of Cambridge.
    3. Topa, Giorgio & Zenou, Yves, 2015. "Neighborhood and Network Effects," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 561-624, Elsevier.
    4. Simon Weidenholzer, 2010. "Coordination Games and Local Interactions: A Survey of the Game Theoretic Literature," Games, MDPI, vol. 1(4), pages 1-35, November.
    5. Olaizola Ortega, María Norma & Valenciano Llovera, Federico, 2016. "A Marginalist Model of Network Formation," IKERLANAK info:eu-repo/grantAgreeme, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
    6. Cabrales, Antonio & Calvó-Armengol, Antoni & Zenou, Yves, 2011. "Social interactions and spillovers," Games and Economic Behavior, Elsevier, vol. 72(2), pages 339-360, June.
    7. Fosco, Constanza & Mengel, Friederike, 2011. "Cooperation through imitation and exclusion in networks," Journal of Economic Dynamics and Control, Elsevier, vol. 35(5), pages 641-658, May.
    8. Sanjeev Goyal & Adrien Vigier, 2014. "Attack, Defence, and Contagion in Networks," Review of Economic Studies, Oxford University Press, vol. 81(4), pages 1518-1542.
    9. de Marti, Joan & Zenou, Yves, 2009. "Social Networks," Working Paper Series 816, Research Institute of Industrial Economics.
    10. Michael D. König & Xiaodong Liu & Yves Zenou, 2019. "R&D Networks: Theory, Empirics, and Policy Implications," The Review of Economics and Statistics, MIT Press, vol. 101(3), pages 476-491, July.
    11. Dunia Lopez-Pintado, 2016. "Influence networks and public goods," UMASS Amherst Economics Working Papers 2016-12, University of Massachusetts Amherst, Department of Economics.
    12. Olaizola Ortega, María Norma & Valenciano Llovera, Federico, 2015. "Efficiency vs. Stability in a Mixed Network Formation Model," IKERLANAK info:eu-repo/grantAgreeme, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
    13. Acemoglu, Daron & Malekian, Azarakhsh & Ozdaglar, Asu, 2016. "Network security and contagion," Journal of Economic Theory, Elsevier, vol. 166(C), pages 536-585.
    14. Olaizola, Norma & Valenciano, Federico, 2013. "Network formation under linking constraints," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 392(20), pages 5194-5205.
    15. Goyal, S., 2018. "Heterogeneity and Networks," Cambridge Working Papers in Economics 1812, Faculty of Economics, University of Cambridge.
    16. Sanjeev Goyal & Stephanie Rosenkranz & Utz Weitzel & Vincent Buskens, 2017. "Information Acquisition and Exchange in Social Networks," Economic Journal, Royal Economic Society, vol. 127(606), pages 2302-2331, November.
    17. Vigier, A., 2008. "Globalization, Education, and the Topology of Social Networks," Cambridge Working Papers in Economics 0851, Faculty of Economics, University of Cambridge.
    18. Andrea Galeotti & Luca Paolo Merlino, 2014. "Endogenous Job Contact Networks," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 55(4), pages 1201-1226, November.
    19. He, Simin & Zou, Xinlu, 2024. "Public goods provision in a network formation game," Journal of Economic Behavior & Organization, Elsevier, vol. 218(C), pages 104-131.
    20. Olaizola, Norma & Valenciano, Federico, 2014. "Asymmetric flow networks," European Journal of Operational Research, Elsevier, vol. 237(2), pages 566-579.
      • Olaizola Ortega, María Norma & Valenciano Llovera, Federico, 2012. "Asymmetric flow networks," IKERLANAK http://www-fae1-eao1-ehu-, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:phsmap:v:392:y:2013:i:21:p:5453-5460. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/physica-a-statistical-mechpplications/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.