Liu, Xiaodong; Patacchini, Eleonora; Zenou, Yves - C.E.P.R. Discussion Papers - 2011
We develop two different social network models with different economic foundations. In the local-aggregate model, it is the sum of friends' efforts in some activity that affects the utility of each individual while, in the local-average model, it is costly to deviate from the average effort of...