arXiv 29 Dec 2020 · Econometrics · publishedNetwork Science (2022) · 1 citations (OpenAlex)
arXiv:2012.14886 · PDF · DOI · OpenAlex · Extracted main text
In this study, we consider a pairwise network formation model in which each dyad of agents strategically determines the link status between them. Our model allows the agents to have unobserved group heterogeneity in the propensity of link formation. For the model estimation, we propose a three-step maximum likelihood (ML) method. First, we obtain consistent estimates for the heterogeneity parameters at individual level using the ML estimator. Second, we estimate the latent group structure using the binary segmentation algorithm based on the results obtained from the first step. Finally, based on the estimated group membership, we re-execute the ML estimation. Under certain regularity conditions, we show that the proposed estimator is asymptotically unbiased and distributed as normal at the parametric rate. As an empirical illustration, we focus on the network data of international visa-free travels. The results indicate the presence of significant strategic complementarity and a certain level of degree heterogeneity in the network formation behavior.
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The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Ke, Y., Li, J., Zhang, W., et al (2016) Structure identification in panel data analysis | 1.000 | 6 | 4 | 100% |
| 2 | Yan, T., Jiang, B., Fienberg, S.E., and Leng, C (2019) Statistical inference in a directed network model with covariates | 1.000 | 5 | 3 | 100% |
| 3 | Wang, W. and Su, L (2020) Identifying latent group structures in nonlinear panels | 0.950 | 7 | 5 | 86% |
| 4 | Bai, J (1997) Estimating multiple breaks one at a time | 0.843 | 3 | 3 | 100% |
| 5 | Berry, S.T (1992) Estimation of a model of entry in the airline industry | 0.843 | 3 | 3 | 100% |
| 6 | Bresnahan, T.F. and Reiss, P.C (1990) Entry in monopoly market | 0.843 | 3 | 3 | 100% |
| 7 | Bonhomme, S. and Manresa, E (2015) Grouped patterns of heterogeneity in panel data | 0.811 | 4 | 2 | 100% |
| 8 | Graham, B.S (2017) An econometric model of network formation with degree heterogeneity | 0.737 | 3 | 3 | 67% |
| 9 | Aradillas-Lopez, A. and Rosen, A.M (2019) Inference in ordered response games with complete information | 0.737 | 3 | 2 | 100% |
| 10 | Dzemski, A (2019) An empirical model of dyadic link formation in a network with unobserved heterogeneity | 0.737 | 3 | 2 | 100% |
Showing the top 10 of 53 scored citations.
arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.
| Citing paper | Intensity | Mentions | Sections | |
|---|---|---|---|---|
| 1 | Penalized Likelihood for Dyadic Network Formation Models with Degree Heterogeneity | 0.644 | 2 | 2 |
| 2 | Estimating Dyadic Treatment Effects with Unknown Confounders | 0.405 | 1 | 1 |