We consider a model in which productive bilateral links are formed between heterogeneous agents who differ in their innate productivity. Local information is complete but an outside planner can observe only network properties. We ask if consistent credit rating -- where agents' ratings are...

We consider a productive network formed by agents with heterogeneous privately-known productivity types. Under convex cost of link formation, bilateral links create endogenous externalities. We calculate the "rearrangement cost" imposed on the entire network by each subset of other agents an...