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by Matthew O. Jackson, Brian W. Rogers
In Proceedings of the P2P Conference
http://www.grandcoalition.com/papers/jackson_6.pdf
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Abstract:
We introduce a search-based economic model of network formation. Individuals enter over time and find others at random and through a local search process, and then decide which links to form based on myopic self-interested utility maximization. This model simultaneously accounts for three stylized features of a number of observed large networks: (i) connections tend to be much more highly clustered than one would see in a random network formation process, (ii) the maximal distance between nodes is relatively small (on the order of log[network size]/log[log[network size]]- which is small even compared to a random network), and (iii) the distribution of node degrees obeys a power law in the upper tail (there are many more highly linked nodes than one should see in a purely random network, and in particular proportions), but not necessarily for smaller degrees. 1
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