Cavalcanti, T.V.D., Giannitsarou, C. and Johnson, C.R.

Network Cohesion

Economic Theory

Vol. 64(1) pp. 1-21 (2017)

Abstract: We define a measure of network cohesion and show how it arises naturally in a broad class of dynamic models of endogenous perpetual growth with network externalities. Via a standard growth model, we show why network cohesion is crucial for conditional convergence and explain that as cohesion increases, convergence is faster. We prove properties of network cohesion and define a network aggregator that preserves network cohesion.

Keywords: Network theory, Ednogenous growth models, Convergence, Consensus

JEL Codes: D85, O40, D62

Author links: Tiago Cavalcanti Chryssi Giannitsarou

Publisher's Link: http://dx.doi.org/10.1007/s00199-016-0992-1