The fundamental question I address in the dissertation is how the behavior of economic agents interacts with networks of relationships which underlie a wide set of economic situations. In Ch. 2, entitled "Decentralized Information Sharing in Oligopoly," I analyze the incentives of firms for information sharing in a decentralized environment when firms face a stochastic demand. In order to do that, I develop a two stage model of strategic network formation, where a cooperative network formation stage is played in the first stage and a noncooperative Bayesian Cournot game is played in the second stage. I derive pure strategy mixed cooperative and noncooperative equilibria that are subgame perfect and stable, and characterize the resulting network structures. Ch. 3, entitled "A War of Attrition in Network Formation," investigates the strategic behavior of agents when they face a decision on the formation of relationships. I apply a war of attrition to the dynamic network formation process when links among agents have characteristics of public goods. Agents are randomly but exogenously matched in each stage. Based on Bala and Goyal's (2000) two-way flow model, I characterize the subgame-perfect equilibrium outcomes and discuss their efficiency. Finally, Ch. 4, entitled "Social Norms and Trust among Strangers," (with Huan Xie) studies the development of trust and reciprocity among strangers in the indefinitely repeated trust game with random matching. If reputation is attached to the community as a whole and if a single defection leads to the destruction of the cooperative social norm through contagious punishments, the cooperative social norm can be sustained by the self-interested community members in the equilibrium. We provide sufficient conditions that support the social norm of trust and reciprocity as a sequential equilibrium.
| Identifer | oai:union.ndltd.org:PITT/oai:PITTETD:etd-04232007-165226 |
| Date | 22 June 2007 |
| Creators | Lee, Yong-Ju |
| Contributors | Esther Gal-Or, Ted Temzelides, Utku Unver, John Duffy |
| Publisher | University of Pittsburgh |
| Source Sets | University of Pittsburgh |
| Language | English |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://etd.library.pitt.edu/ETD/available/etd-04232007-165226/ |
| Rights | unrestricted, I hereby certify that, if appropriate, I have obtained and attached hereto a written permission statement from the owner(s) of each third party copyrighted matter to be included in my thesis, dissertation, or project report, allowing distribution as specified below. I certify that the version I submitted is the same as that approved by my advisory committee. I hereby grant to University of Pittsburgh or its agents the non-exclusive license to archive and make accessible, under the conditions specified below, my thesis, dissertation, or project report in whole or in part in all forms of media, now or hereafter known. I retain all other ownership rights to the copyright of the thesis, dissertation or project report. I also retain the right to use in future works (such as articles or books) all or part of this thesis, dissertation, or project report. |
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