Lock-in through passive connections

A-Tier
Journal: Journal of Economic Theory
Year: 2021
Volume: 192
Issue: C

Authors (2)

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We consider a model of social coordination and network formation where agents decide on an action in a coordination game and on whom to establish costly links to. We study the role of passive connections; these are links that other agents form to a given agent. Such passive connections may create an endogenously arising form of lock-in where agents don't switch actions and links, as this may result in a loss of payoff received through them. When agents are constrained in the number of links they form, the set of Nash equilibria includes action-heterogenous strategy profiles, where different agents choose different actions. Depending on the precise parameters of the model, risk-dominant, payoff-dominant, or action-heterogenous strategy profiles are stochastically stable.

Technical Details

RePEc Handle
repec:eee:jetheo:v:192:y:2021:i:c:s0022053121000041
Journal Field
Theory
Author Count
2
Added to Database
2026-01-25