Estimating Network Externalities in Undirected Link Formation Games
无向连接形成博弈中的网络外部性估计AI 解读 ↓
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无向连接形成博弈中的网络外部性估计AI 解读 ↓
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ABSTRACT This paper explores the existence of network externalities in link formation games of incomplete information. It extends the structural estimation method in Leung (2015) to games where links are undirected and proposals are only partially observed. We provide an econometric characterization of the proposed two‐step estimator and document its performance through a simulation exercise. When the estimation method is applied to data on risk‐sharing arrangements in a Tanzanian village, results indicate that indirect connections matter.
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