To study how economic fundamentals affect the formation of social networks, a model is needed that (i) has agents responding rationally to incentives (ii) can be taken to the data. This paper combines game-theoretic and statistical approaches to network formation in order to develop such a...

In 1983 Cox and Kemperman proved that Ef(ξ)+Ef(η)≤Ef(ξ+η) for functions f with convex second derivative and independent centered random variables ξ and η. We suggest another proof, show that the minimal moment restrictions are sufficient, and write out a less restrictive condition on f...

Foster and Hart proposed an operational measure of riskiness for discrete random variables. We show that their defining equation has no solution for many common continuous distributions including many uniform distributions, e.g. We show how to extend consistently the definition of riskiness to...