Title
Coordination and Evolutionary Network Formation with Asymmetric Link Costs: Part One
Abstract
We analyze a dynamic implication
of an evolutionary process in a population where both actions and network
structures changes over time.
At every period, a coordination game is played by players who
are linked with each other. An asymmetric cost of a link is incorporated.
Under this setting each player myopically adopts with its circumstance
consisting of the network structure and the action profile.
In a stochastically stable state there are link cost patterns such that all players play a pareto dominant equilibrium strategy of coordination game. This is the most different result from a standard stochastic evolutionary models that selects a risk dominant equilibrium.
Key words: Network formation, coordination game,
stochastic evolution, asymmetric link cost, pareto dominant equilibrium, risk
dominant equilibrium
Masakazu FUKUZUMI
Research Institute for Economics and Business
Administration
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501
Japan
Phone: (81) 78 803 7036
Fax:
(81) 78 803 7059