The Importance of Network Topology in Local Contribution Games

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The Importance of Network Topology in Local Contribution Games

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Title: The Importance of Network Topology in Local Contribution Games
Author: Corbo, Jacomo; Calvó-Armengol, Antoni; Parkes, David C.

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Citation: Corbo, Jacomo, Antoni Calvó-Armengol, and David C. Parkes. 2007. The importance of network topology in local contribution games. In Internet and Network Economics, ed., X. Deng, F.C. Graham, 388-395. Berlin, Heidelberg: Springer. Previously published in Lecture Notes in Computer Science 4858: 388-395.
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Abstract: We consider a model of content contribution in peer-to-peer networks with linear quadratic payoffs and very general interaction patterns. We find that Nash equilibria of this game always exist; moreover, they are computable by solving a linear complementarity problem. The equilibrium is unique when goods are strategic complements or weak substitutes and contributions are proportional to a network centrality measure called the Bonacich index. In the case of public goods, the equilibrium is non-unique and characterized by k-order maximal independent sets. The structure of optimal networks is always star-like when the game exhibits strict or weak complements. Under public good scenarios, while star-like networks remain optimal in the best case, they also yield the worst-performing equilibria. We also discuss a network-based policy for improving the equilibrium performance of networks by the exclusion of a single player.
Published Version: doi:10.1007/978-3-540-77105-0_43
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