The Structure of Online Consumer Communication Networks
Marjolein J. W. Harmsen - van Hout
Lehrstuhl für Wirtschaftswissenschaften, insb. Energieökonomik; Institute for Future Energy Consumer Needs and Behavior (FCN); E.ON Energy Research Center; RWTH Aachen
P. Jean-Jacques Herings
Benedict G. C. Dellaert
Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE); Erasmus Research Institute of Management (ERIM)
March 1, 2010
FCN Working Paper No. 3/2010
We analyze the structure of bilateral communication links among consumers in virtual communities by a game-theoretic model of network formation. First, link specificity is incorporated, meaning that the more direct links somebody has to maintain with others, the less she is able to specify her attention per link, so that the value of her links decreases. Second, a distinction is made between the social and informational value from communication, where informational value is transferable via indirect links, whereas social value is not. We characterize the set of pairwise stable structures in the case with only social value to indicate the separate impact of link specificity and demonstrate that it includes a wide range of non-standard architectures under large link specificity and particular combinations of fully connected components under low link specificity. In the case with both social and informational value, the joint effect of link specificity and value transferability is shown to reduce the pairwise stable set to particular fragmented architectures under large link specificity or rather to the complete network under small link specificity.
Number of Pages in PDF File: 31
Keywords: Consumers, Virtual Communities, Bilateral Communication Links, Social vs. Informational Value, Specificity, Transferability, Network Formation, Game Theory
JEL Classification: A14, C79, D85, M31working papers series
Date posted: June 4, 2010
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