On perfect pairwise stable networks

• 成果类型: Article
• 署名作者: Bich, Philippe; Teteryatnikova, Mariya
• 署名单位: Paris School of Economics; HSE University (National Research University Higher School of Economics); Vienna University of Economics & Business
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2022.105577
• 发表日期: 2023
• 关键词: Pairwise stable network; Perfect pairwise stable network; Weighted networks

摘要

We extend standard tools from equilibrium refinement theory in non-cooperative games to a coopera-tive framework of network formation. First, we introduce the new concept of perfect pairwise stability. It transposes the idea of trembling hand perfection to network formation theory and strictly refines the pairwise stability concept of Jackson and Wolinsky (1996). Second, we study basic properties of perfect pairwise stability: existence, admissibility and perturbation. We further show that our concept is distinct from the concept of strongly stable networks introduced by Jackson and Van den Nouweland (2005), and perfect Nash equilibria of the Myerson network formation game studied by Calvo-Armengol and Ilkilic (2009). Finally, we apply perfect pairwise stability to sequential network formation and prove that it en-ables a refinement of sequential pairwise stability, a natural analogue of subgame perfection in a setting with cooperative, pairwise link formation.(c) 2022 Elsevier Inc. All rights reserved.