Dhyne, Emmanuel; Kikkawa, Ayumu Ken; Kong, Xianglong; … - 2023
This paper presents a tractable model of endogenous production networks with fixed costs associated with the formation … acyclic. Our main theoretical result is that the closed economy equilibrium is unique if the set of feasible networks consists … only of networks that are acyclic and the buyer initiates the link formation while having full bargaining power in price …