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Games on Multiplex Networks

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  • Zenou, Yves
  • Zhou, Junjie

Abstract

We provide a simple network model of multiple layers, an important but understudied topic in the network literature. On any layer, agents' incentives are influenced by their within-layer social ties. Facing aggregate effort constraints, agents optimize across layers, which may have heterogeneous network structures. We first characterize the equilibrium of this game and determine the importance of both within and between-layer interactions in terms of shock propagation. Then, we identify the optimal targeting interventions with multiplexity in which the planner needs to take into account both the impact of its policy on one layer and that on the other interconnected layers. Applications and simulations to the management of multiple social relationships and multiple public goods help us understand the complex mechanisms behind our results.

Suggested Citation

  • Zenou, Yves & Zhou, Junjie, 2024. "Games on Multiplex Networks," CEPR Discussion Papers 18951, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:18951
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    More about this item

    JEL classification:

    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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