We reconsider de Marti and Zenou (2017) model of friendship network formation where individuals belong to two different communities and costs of forming links depend on community memberships. Many inefficient friendship networks such as segregation can arise when all individuals are myopic. Once...

We reconsider de Marti and Zenou (2017) model of friendship network formation where individuals belong to two different communities and costs of forming links depend on community memberships. Many inefficient friendship networks such as segregation can arise when all individuals are myopic. Once...

We adopt the notion of myopic-farsighted stable set to study the stability of networks when myopic and farsighted individuals decide with whom they want to form a link, according to some utility function that weighs the costs and benefits of each connection. A myopic-farsighted stable set is the...