Eight Degrees of Separation
Title: Eight Degrees of Separation
Author: PIN, Paolo
Publisher: European University Institute
Series/Report no.: EUI MWP; 2008/44
We present a network formation game whose equilibria are undirected networks. Every connected couple contributes to the aggregate payoff by a fixed quantity, and the outcome is split between players according to the Myerson value allocation rule. This setup shows a wide multiplicity of non-empty equilibria, all of them connected. We show that the efficient equilibria of the game are either the empty network, or a network whose diameter does not exceed the threshold of 8 (i.e. there are no two nodes with distance greater than 8).
Subject: Network formation; Myerson value; D85
Type of Access: openAccess