Credibility and strategic learning in networks

We analyze a model of diffusion in a fixed, finite connected network. There is an interested party that knows the quality of the product being propagated and chooses an implant in the network to influence other agents to buy. Agents are either "innovators," who adopt immediately, or ration...

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Bibliographic Details
Published in:International economic review (Philadelphia) 2016-08, Vol.57 (3), p.759-785
Main Authors: Chatterjee, Kalyan, Dutta, Bhaskar
Format: Article
Language:English
Subjects:
Agency theory
Bayesian analysis
Consumer choice
Decision making models
Discounting
Expected utility
Goods
Innovation
Innovation diffusion
Konsum
Lernen
Neighborhoods
Network access lines
Observational learning
Ordinary differential equations
Product innovation
Product quality
Recommendations
Social networks
Soziales Netzwerk
Studies
Theorie
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Summary:We analyze a model of diffusion in a fixed, finite connected network. There is an interested party that knows the quality of the product being propagated and chooses an implant in the network to influence other agents to buy. Agents are either "innovators," who adopt immediately, or rational. Rational consumers buy if buying instead of waiting maximizes expected utility. We consider the conditions on the network under which optimal diffusion of the good product with probability 1 is a perfect Bayes equilibrium.
ISSN:0020-6598
1468-2354
1468-2354
DOI:10.1111/iere.12175