Here.
This is a follow up to Bala and Goyal.
In the benchmark model of Bala and Goyal (2000) on network formation, the equilibrium network is asymmetric and unfair as agents have different payoffs. While they are prominent in reality, asymmetric networks do not emerge in the lab mainly because of fairness concerns. We extend this model with a sequential linking decision process to ease coordination and with heterogeneous agents. Heterogeneity is introduced with the presence of a special agent who has either a higher monetary value or a different status. The equilibrium is asymmetric and unfair. Our experimental results show that thanks to sequentiality and fairness concerns, individuals coordinate on fair and efficient networks in homogeneous settings. Heterogeneity impacts the network formation process by increasing the asymmetry of networks but does not decrease the level of fairness nor efficiency.
Procedures The experimental sessions were conducted at GATE-LAB, Lyon, France. We ran two sessions of each treatment with 20 individuals in each session. In total we had 160 participants. 57% of them are female and 84% are undergraduate students, 10% are employees and 6% are unemployed. At the beginning of the experiment, we randomly allocated each participant to a computer. Instructions were read out loud and the experimentalists checked the individuals’ understanding and answered additional questions in private. When participants indicated that there were no more questions, the experiment started. Before the network formation part, we elicited risk attitudes using the procedure of Gneezy and Potters (1997).12 At the end of the experiment, individuals participated in the Social Value Orientation test (Murphy et al., 2011) to evaluate their social preferences.13 Participants were recruited online through H-root (Bock et al., 2014). Each session lasted 75 minutes. Participants earned on average 15.26 Euros (SD 1.96).
(I think I'm going to start including more about experiment protocols.)
From:
Liza Charroin
University of Lyon
This is a follow up to Bala and Goyal.
In the benchmark model of Bala and Goyal (2000) on network formation, the equilibrium network is asymmetric and unfair as agents have different payoffs. While they are prominent in reality, asymmetric networks do not emerge in the lab mainly because of fairness concerns. We extend this model with a sequential linking decision process to ease coordination and with heterogeneous agents. Heterogeneity is introduced with the presence of a special agent who has either a higher monetary value or a different status. The equilibrium is asymmetric and unfair. Our experimental results show that thanks to sequentiality and fairness concerns, individuals coordinate on fair and efficient networks in homogeneous settings. Heterogeneity impacts the network formation process by increasing the asymmetry of networks but does not decrease the level of fairness nor efficiency.
Procedures The experimental sessions were conducted at GATE-LAB, Lyon, France. We ran two sessions of each treatment with 20 individuals in each session. In total we had 160 participants. 57% of them are female and 84% are undergraduate students, 10% are employees and 6% are unemployed. At the beginning of the experiment, we randomly allocated each participant to a computer. Instructions were read out loud and the experimentalists checked the individuals’ understanding and answered additional questions in private. When participants indicated that there were no more questions, the experiment started. Before the network formation part, we elicited risk attitudes using the procedure of Gneezy and Potters (1997).12 At the end of the experiment, individuals participated in the Social Value Orientation test (Murphy et al., 2011) to evaluate their social preferences.13 Participants were recruited online through H-root (Bock et al., 2014). Each session lasted 75 minutes. Participants earned on average 15.26 Euros (SD 1.96).
(I think I'm going to start including more about experiment protocols.)
From:
Liza Charroin
University of Lyon