Contagious Matching Games

10 Pages Posted: 1 Jul 2020 Last revised: 1 Mar 2021

See all articles by Elena Quercioli

Elena Quercioli

University of Texas Rio Grande Valley (UTRGV) (Formerly University of Texas-Pan American)

Lones Smith

University of Wisconsin at Madison - Department of Economics

Date Written: November 12, 2006

Abstract

This paper explores a simple class of matching games in which individuals meet pairwise, unwittingly passing along a bad in a contagion fashion. It may be a private “bad”, like a counterfeit money or stolen art. Or it may be a collective “bad”, like a disease or a computer virus. Either way, individuals expend effort to avoid acquiring the “bad”. With a private “bad”, these efforts are complements, and the game is submodular. With a collective “bad”, they are substitutes, and the game is supermodular.

The symmetric equilibria of these games share a common feature, that the marketplace often produces fewer “infections” as the bad grows more prevalent. One cannot, for instance, infer that counterfeiting is less severe when there is less passed counterfeit money.

Keywords: SIR model, pairwise matching, Nash equilibrium

JEL Classification: D, I

Suggested Citation

Quercioli, Elena and Smith, Lones, Contagious Matching Games (November 12, 2006). Available at SSRN: https://ssrn.com/abstract=3621657 or http://dx.doi.org/10.2139/ssrn.3621657

Elena Quercioli

University of Texas Rio Grande Valley (UTRGV) (Formerly University of Texas-Pan American) ( email )

1201 W. University Drive
Edinburg, TX 78539
United States

Lones Smith (Contact Author)

University of Wisconsin at Madison - Department of Economics ( email )

1180 Observatory Drive
Madison, WI 53706-1393
United States
608-263-3871 (Phone)
608-262-2033 (Fax)

HOME PAGE: http://www.lonessmith.com

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