Favoritism

Favoritism is the act of offering jobs, contracts and resources to members of one's social group in preference to outsiders. Favoritism is widely practiced and this motivates an exploration of its origins and economic consequences. Our main finding is that individuals have an interest to trade favors over time and that this will come at the expense of others, who are outside their group. We show that favoritism is relatively easier to sustain in smaller groups. Favoritism entails social costs as it usually leads to inefficient allocations. However, favoritism can lead to payoff advantages for larger groups. Productivity enhancing investments are larger in groups which practice favoritism. The availability of investment opportunities can reinforce payoff inequalities across groups.Favoritism, nepotism, reciprocity, repeated games

Diversity and Popularity in Social Networks

Homophily, the tendency of linked agents to have similar characteristics, is an important feature of social networks. We present a new model of network formation that allows the linking process to depend on individuals types and study the impact of such a bias on the network structure. Our main results fall into three categories: (i) we compare the distributions of intra- and inter-group links in terms of stochastic dominance, (ii) we show how, at the group level, homophily depends on the groups size and the details of the formation process, and (iii) we understand precisely the determinants of local homophily at the individual level. Especially, we find that popular individuals have more diverse networks. Our results are supported empirically in the AddHealth data looking at networks of social connections between boys and girls.Social networks, Network formation, Homophily, Diversity

Risk Aversion and International Environmental Agreements

We introduce uncertainty and risk aversion to the study of international environmental agreements. We consider a simple model with identical agents and linear payoffs. We show that a stable treaty with positive action always exists. While uncertainty lowers the action of signatories, we find that it may increase participation. In addition, uncertainty may generate multiple equilibria. A treaty with low action and low participation may coexist with one with high action and high participation. Overall, and despite risk aversion, the impact of uncertainty on welfare may be positive. A reduction in uncertainty may hurt international cooperation.International Environmental Agreements, Risk Aversion, Uncertainty

The Econometrics of Social Networks

In a social network, agents have their own reference group that may influence their behavior. In turn, the agents' attributes and their behavior affect the formation and the structure of the social network. We survey the econometric literature on both aspects of social networks and discuss the identification and estimation issues they raise.Social network, peer effects, identification, network formation, pair-wise regressions, separability, mutual consent

Strategic Interaction and Networks

This paper brings a general network analysis to a wide class of economic games. A network, or interaction matrix, tells who directly interacts with whom. A major challenge is determining how network structure shapes overall outcomes. We have a striking result. Equilibrium conditions depend on a single number: the lowest eigenvalue of a network matrix. Combining tools from potential games, optimization, and spectral graph theory, we study games with linear best replies and characterize the Nash and stable equilibria for any graph and for any impact of players’ actions. When the graph is sufficiently absorptive (as measured by this eigenvalue), there is a unique equilibrium. When it is less absorptive, stable equilibria always involve extreme play where some agents take no actions at all. This paper is the first to show the importance of this measure to social and economic outcomes, and we relate it to different network link patterns.Networks, potential games, lowest eigenvalue, stable equilibria, asymmetric equilibria

Tyr dans les sources de la période fatimide (969-1171)

International audienceL'analyse de sources se rapportant à la période de domination fatimide sur Tyr révèle la complexité des rapports qui lièrent cette ville portuaire à la dynastie fatimide et le rôle singulier qu'elle joua entre 970-971 et 1124. De l'antique cité phénicienne, les auteurs arabes ne parlent guère au moment où, vers 970-971, les troupes fatimides prennent, port après port, le contrôle du littoral syro-palestinien. Tyr constituait une pièce de choix pour les nouveaux maîtres basés en Égypte et elle semblait destinée à jouer un rôle majeur dans le dispositif naval fatimide alors en pleine élaboration. Les Fatimides, dynastie chiite partie d'Ifrīqīyā avec l'objectif de chasser les Abbassides de Bagdad et de régner sur l'ensemble du monde musulman, avaient besoin de tenir fermement les ports de la côte syro-palestinienne pour en faire des points d'ancrage de leur avancée vers l'Orient. Leur ambition fut cependant déçue à mesure que les difficultés s'amoncelèrent devant eux. Les révoltes des tribus bédouines de Palestine et de Syrie, de même que l'incurie des gouverneurs, contribuèrent à contrecarrer leurs plans. La guerre civile qui manqua de renverser la dynastie au début des années 1070, les attaques byzantines, celles des Turcs seldjoukides et, enfin, le déclenchement de la première croisade, empêchèrent la réalisation de leur projet impérialiste. L'objectif devint, bien plus modestement, le maintien de la dynastie essentiellement en Égypte et sur le littoral du Bilād al-Šām, dont Tyr constituait un site majeur. Plusieurs types de sources rédigées durant la période fatimide permettent d'appréhender le rôle de cette cité portuaire, non seulement dans l'histoire de la dynastie égyptienne, mais plus largement dans l'histoire du Proche-Orient médiéval. Les documents arabes constituent assez logiquement la première source de documentation sur Tyr. Allant de l'ouvrage de géographie à la chronique historique, en passant par la relation de voyage, ces textes sont de nature très diverse 1. Certains peuvent avoir été 1. Ibn Ḥawqal (m. après 973) est originaire de Nisibe en Haute-Mésopotamie et passe au Proche-Orient dans les toutes premières années de la période fatimide. Al-Muqaddasī (ca 946-1000) est un géographe palestinien originaire de Jérusalem (Bayt al-Maqdis). Il est l'auteur de l'un des fleurons de la géographie arabe dite des Masālik wa l-mamālik (Routes et royaumes). A. Miquel, La géographie humaine du monde musulman jusqu'au milieu du XI

Identification of Peer Effects through Social Networks

We provide new results regarding the identification of peer effects. We consider an extended version of the linear-in-means model where each individual has his own specific reference group. Interactions are thus structured through a social network. We assume that correlated unobservables are either absent, or treated as fixed effects at the component level. In both cases, we provide easy-to-check necessary and sufficient conditions for identification. We show that endogenous and exogenous effects are generally identified under network interaction, although identification may fail for some particular structures. Monte Carlo simulations provide an analysis of the effects of some crucial characteristics of a network (i.e., density, intransitivity) on the estimates of social effects. Our approach generalizes a number of previous results due to Manski (1993), Moffitt (2001), and Lee (2006).Social networks, Peer effects, identification, reflection problem