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Addiction in networks

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Abstract

This paper develops a dynamic model of addiction on networks, where individuals’ consumption is shaped by peer influence. We analyze the longrun effects of social interactions by characterizing steady-state consumption as a function of both network position and forward-looking behavior. We also examine the welfare implications of network structure and evaluate the effectiveness of various public policies aimed at reducing the demand for addictive goods. In particular, we study a key-player policy—modeled as a targeted rehabilitation program—that leverages the network’s interpersonal influences to maximize impact.

Suggested Citation

  • Frédéric Deroïan & Philippine Escudie, 2025. "Addiction in networks," AMSE Working Papers 2506, Aix-Marseille School of Economics, France.
    • Handle: RePEc:aim:wpaimx:2506
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    File URL: https://www.amse-aixmarseille.fr/sites/default/files/working_papers/wp_2025_nr_06_.pdf
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    More about this item

    Keywords

    Addiction; Peer Network; rational addiction; time-inconsistency;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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