Unions and key players in network games with conflicts and spillovers

Ana Mauleon, Mariam Nanumyan, Simon Schopohl and Vincent Vannetelbosch ()
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Simon Schopohl: Université catholique de Louvain, LIDAM/CORE, Belgium
Vincent Vannetelbosch: Université catholique de Louvain, LIDAM/CORE, Belgium

No 2023012, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: We study network games with social and private dissonance where each player in the network exerts some costly efforts. We allow for cooperative behavior in the sense that players may belong to unions and members of each union choose their efforts by maximizing the joint utility of the union. Each player not only benefits from the aggregate effort and efforts of network neighbors are strategic complements, but also suffers disutility when her effort differs from her neighbors’ efforts or is inconsistent with her ideal effort. We characterize the unique Nash equilibrium of the network game with unions and we define a union intercentrality measure for finding the key player whose removal has the highest impact on the aggregate effort level. In addition, we explore the role of unions in fostering effort levels and we consider two alternative policies: the key addition to an existing union (the player who increases the most the aggregate effort by joining the union) and the key union that generates the highest total effort. Finally, we investigate the stability of unions.

Keywords: Social networks; peer effects; key players; unions; social and private dissonance (search for similar items in EconPapers)
JEL-codes: A14 C72 D85 L14 (search for similar items in EconPapers)
Pages: 35
Date: 2023-04-27
New Economics Papers: this item is included in nep-gth and nep-net
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