We consider a market with a profit-maximizing monopolistic firm. Utility-maximizing consumers either buy one unit of the good or none at all. The demand for the good is influenced by local social interactions. That is , the utility which a consumer derives from the consumption of the good...

We develop an empirical discrete-choice interaction model with a finite number of agents. We characterize its equilibrium properties - in particular the correspondence between interaction strength, number of agents, and the set of equilibria - and propose to estimate the model by means of...