Related papers: Moral Hazard with Network Effects
Critical nodes or "middlemen" have an essential place in both social and economic networks when considering the flow of information and trade. This paper extends the concept of critical nodes to directed networks. We identify strong and…
We consider the mechanism design problem of a principal allocating a single good to one of several agents without monetary transfers. Each agent desires the good and uses it to create value for the principal. We designate this value as the…
We study the interaction between network effects and external incentives on file sharing behavior in Peer-to-Peer (P2P) networks. Many current or envisioned P2P networks reward individuals for sharing files, via financial incentives or…
This paper proposes a method to design an optimal dynamic contract between a principal and an agent, who has the authority to control both the principal's revenue and an engineered system. The key characteristic of our problem setting is…
Several centrality measures have been formulated to quantify the notion of 'importance' of actors in social networks. Current measures scrutinize either local or global connectivity of the nodes and have been found to be inadequate for…
The dynamics of competing opinions in social network play an important role in society, with many applications in diverse social contexts as consensus, elections, morality and so on. Here we study a model of interacting agents connected in…
A network effect is introduced taking into account competition, cooperation and mixed-type interaction amongst agents along a generalized Verhulst-Lotka-Volterra model. It is also argued that the presence of a market capacity enforces an…
We consider the specification of effects of numerical actor attributes in statistical models for directed social networks. A fundamental mechanism is homophily or assortativity, where actors have a higher likelihood to be tied with others…
Faculty hiring networks-who hires whose graduates as faculty-exhibit steep hierarchies, which can reinforce both social and epistemic inequalities in academia. Understanding the mechanisms driving these patterns would inform efforts to…
Reciprocity is firmly established as an important mechanism that promotes cooperation. An efficient information exchange is likewise important, especially on structured populations, where interactions between players are limited. Motivated…
When machine learning is outsourced to a rational agent, conflicts of interest might arise and severely impact predictive performance. In this work, we propose a theoretical framework for incentive-aware delegation of machine learning…
A broad current application of algorithms is in formal and quantitative measures of murky concepts -- like merit -- to make decisions. When people strategically respond to these sorts of evaluations in order to gain favorable decision…
Using the minority game as a model for competition dynamics, we investigate the effects of inter-agent communications on the global evolution of the dynamics of a society characterized by competition for limited resources. The agents…
We use a principal-agent model to analyze the structure of a book-driven dealer market when the dealer faces competition from a crossing network or dark pool. The agents are privately informed about their types (e.g. their portfolios),…
Recent research in industrial organisation has investigated the essential place that middlemen have in the networks that make up our global economy. In this paper we attempt to understand how such middlemen compete with each other through a…
The application of incentives, such as reward and punishment, is a frequently applied way for promoting cooperation among interacting individuals in structured populations. However, how to properly use the incentives is still a challenging…
Financial network games model payment incentives in the context of networked liabilities. In this paper, we advance the understanding of incentives in financial networks in two important directions: minimal clearing (arising, e.g., as a…
A monopolist faces a partially uninformed population of consumers, interconnected through a directed social network. In the network, the monopolist offers rewards to informed consumers (influencers) conditional on informing uninformed…
Public-Private Partnership (PPP) is a contract between a public entity and a consortium, in which the public outsources the construction and the maintenance of an equipment (hospital, university, prison...). One drawback of this contract is…
We study an agency problem between a leader (the principal) seeking to design an optimal incentive scheme to a follower (the agent) to increase the value of a risky project subjected to accidents and volatility uncertainty. The agency…