A theory of buyer-seller networks
Data(s) |
01/06/2001
|
---|---|
Formato |
485 - 508 application/pdf |
Identificador |
American Economic Review, 2001, 91 (3), pp. 485 - 508 0002-8282 |
Idioma(s) |
en_US |
Relação |
American Economic Review |
Tipo |
Journal Article |
Resumo |
This paper introduces a new model of exchange: networks, rather than markets, of buyers and sellers. It begins with the empirically motivated premise that a buyer and seller must have a relationship, a "link," to exchange goods. Networks - buyers, sellers, and the pattern of links connecting them - are common exchange environments. This paper develops a methodology to study network structures and explains why agents may form networks. In a model that captures characteristics of a variety of industries, the paper shows that buyers and sellers, acting strategically in their own self-interests, can form the network structures that maximize overall welfare. |