Bayer, Peter, Kozics, György and Szöke, Nora Gabriella (2022) Best-response dynamics in directed network games. TSE Working Paper, n. 22-1290, Toulouse, France

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We study public goods games played on networks with possibly non-recip-rocal relationships between players. Examples for this type of interactions include one-sided relationships, mutual but unequal relationships, and par-asitism. It is well known that many simple learning processes converge to a Nash equilibrium if interactions are reciprocal, but this is not true in general for directed networks. However, by a simple tool of rescaling the strategy space, we generalize the convergence result for a class of directed networks and show that it is characterized by transitive weight matrices and quadratic best-response potentials. Additionally, we show convergence in a second class of networks; those rescalable into networks with weak exter-nalities. We characterize the latter class by the spectral properties of the absolute value of the network’s weight matrix and by another best-response potential structure.

Item Type: Monograph (Working Paper)
Language: English
Date: January 2022
Place of Publication: Toulouse, France
Uncontrolled Keywords: Networks, externalities, local public goods, potential games, non-reciprocal relations
JEL Classification: C72 - Noncooperative Games
D62 - Externalities
D85 - Network Formation and Analysis - Theory
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse 1 Capitole
Site: UT1
Date Deposited: 25 Jan 2022 12:43
Last Modified: 18 Apr 2024 11:33
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