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24
Contagion in financial networks
 Proceedings of the Royal Society A: Mathematical, Physical and Engineering Science
"... This paper develops an analytical model of contagion in financial networks with arbitrary structure. We explore how the probability and potential impact of contagion is influenced by aggregate and idiosyncratic shocks, changes in network structure, and asset market liquidity. Our findings suggest th ..."
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Cited by 97 (1 self)
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This paper develops an analytical model of contagion in financial networks with arbitrary structure. We explore how the probability and potential impact of contagion is influenced by aggregate and idiosyncratic shocks, changes in network structure, and asset market liquidity. Our findings suggest that financial systems exhibit a robustyetfragile tendency: while the probability of contagion may be low, the effects can be extremely widespread when problems occur. And we suggest why the resilience of the system in withstanding fairly large shocks prior to 2007 should not have been taken as a reliable guide to its future robustness.
Diffusion and cascading behavior in random networks
, 2009
"... We consider a model of diffusion on graphs generalizing both the contact process and the bootstrap percolation. The initial seed of active nodes is chosen at random and remain active forever. Then each node (not in the seed) is activated if the number of active nodes in a random subset of its neighb ..."
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Cited by 28 (12 self)
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We consider a model of diffusion on graphs generalizing both the contact process and the bootstrap percolation. The initial seed of active nodes is chosen at random and remain active forever. Then each node (not in the seed) is activated if the number of active nodes in a random subset of its neighborhood exceeds a random threshold. We study the final set of active nodes for a random graph on n vertices with a given degree sequence. We let n tends to infinity. Under some regularity conditions on the degree sequence, we show that the number of final active nodes satisfy a law of large numbers. We also consider the case of a seed with a single active node and give conditions under which it can trigger a large cascade, i.e. the final set of active nodes contains a positive fraction of the size of the graph. Our results allow to study games with local interactions on a complex network. In particular, we compute the contagion threshold for random networks. Our method is based on the properties of empirical distributions of independent random variables and leads to simple proofs unifying and extending results in the random graphs literature and social science literature. 1
How to win friends and influence people, truthfully: Influence maximization mechanisms for social networks
 In WSDM
, 2012
"... Throughout the past decade there has been extensive research on algorithmic and data mining techniques for solving the problem of influence maximization in social networks: if one can incentivize a subset of individuals to become early adopters of a new technology, which subset should be selected so ..."
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Cited by 24 (3 self)
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Throughout the past decade there has been extensive research on algorithmic and data mining techniques for solving the problem of influence maximization in social networks: if one can incentivize a subset of individuals to become early adopters of a new technology, which subset should be selected so that the wordofmouth effect in the social network is maximized? Despite the progress in modeling and techniques, the incomplete information aspect of the problem has been largely overlooked. While data can often provide the network structure and influence patterns may be observable, the inherent cost individuals have to become early adopters is difficult to extract. In this paper we introduce mechanisms that elicit individuals’ costs while providing desirable approximation guarantees in some of the most wellstudied models of social network influence. We follow the mechanism design framework which advocates for allocation and payment schemes that incentivize individuals to report their true information. We also performed experiments using the Mechanical Turk platform and social network data to provide evidence of the framework’s effectiveness in practice.
The Role of Game Theory in Human Computation Systems
, 2009
"... The paradigm of “human computation” seeks to harness human abilities to solve computational problems or otherwise perform distributed work that is beyond the scope of current AI technologies. One aspect of human computation has become known as “games with a purpose ” and seeks to elicit useful compu ..."
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Cited by 14 (1 self)
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The paradigm of “human computation” seeks to harness human abilities to solve computational problems or otherwise perform distributed work that is beyond the scope of current AI technologies. One aspect of human computation has become known as “games with a purpose ” and seeks to elicit useful computational work in fun (typically) multiplayer games. Human computation also encompasses distributed work (or “peer production”) systems such as Wikipedia and Question and Answer forums. In this short paper, we survey existing gametheoretic models for various human computation designs, and outline research challenges in advancing a theory that can enable better design.
Finding red balloons with split contracts: robustness to individuals’ selfishness
 In ACM Symposium on Theory of Computing
, 2012
"... The present work deals with the problem of information acquisition in a strategic networked environment. To study this problem, Kleinberg and Raghavan (FOCS 2005) introduced the model of query incentive networks, where the root of a binomial branching process wishes to retrieve an information – know ..."
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Cited by 8 (1 self)
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The present work deals with the problem of information acquisition in a strategic networked environment. To study this problem, Kleinberg and Raghavan (FOCS 2005) introduced the model of query incentive networks, where the root of a binomial branching process wishes to retrieve an information – known by each node independently with probability 1/n – by investing as little as possible. The authors considered fixedpayment contracts in which every node strategically chooses an amount to offer its children (paid upon information retrieval) to convince them to seek the information in their subtrees. Kleinberg and Raghavan discovered that the investment needed at the root exhibits an unexpected threshold behavior that depends on the branching parameter b. For b> 2, the investment is linear in the expected distance to the closest information (logarithmic in
Efficient control of epidemics over random networks
, 2009
"... Motivated by the modeling of the spread of viruses or epidemics with coordination among agents, we introduce a new model generalizing both the basic contact model and the bootstrap percolation. We analyze this percolated threshold model when the underlying network is a random graph with fixed degree ..."
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Cited by 8 (4 self)
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Motivated by the modeling of the spread of viruses or epidemics with coordination among agents, we introduce a new model generalizing both the basic contact model and the bootstrap percolation. We analyze this percolated threshold model when the underlying network is a random graph with fixed degree distribution. Our main results unify many results in the random graphs literature. In particular, we provide a necessary and sufficient condition under which a single node can trigger a large cascade. Then we quantify the possible impact of an attacker against a degree based vaccination and an acquaintance vaccination. We define a security metric allowing to compare the different vaccinations. The acquaintance vaccination requires no knowledge of the node degrees or any other global information and is shown to be much more efficient than the uniform vaccination in all cases.
Spotting trendsetters: Inference for network games
 in Proc. Ann. Allerton Conf. Commununication, Control and Computing
, 2012
"... Abstract — Network games provide a basic framework for studying the diffusion of new ideas or behaviors through a population. In these models, agents decide to adopt a new idea based on optimizing payoff that depends on the adoption decisions of their neighbors in an underlying network. Assuming su ..."
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Cited by 3 (0 self)
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Abstract — Network games provide a basic framework for studying the diffusion of new ideas or behaviors through a population. In these models, agents decide to adopt a new idea based on optimizing payoff that depends on the adoption decisions of their neighbors in an underlying network. Assuming such a model, we consider the problem of inferring early adopters or first movers given a snap shot of the adoption state at a given time. We present some results on solving this problem in the low temperature regime. We conclude with a discussion on reducing the complexity of such inference problems for large networks. I.
Robustness of equilibria in anonymous local games
 J. Econ. Theory
, 2010
"... This paper studies the robustness of symmetric equilibria in anonymous local games to perturbations of prior beliefs. Two priors are strategically close on a class of games if players receive similar expected payoffs in equilibrium under the priors, for any game in that class. I show that if the str ..."
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Cited by 2 (1 self)
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This paper studies the robustness of symmetric equilibria in anonymous local games to perturbations of prior beliefs. Two priors are strategically close on a class of games if players receive similar expected payoffs in equilibrium under the priors, for any game in that class. I show that if the structure of payoff interdependencies is sparse in a welldefined sense, the conditions for strategic proximity in anonymous local games are strictly weaker than the conditions for general Bayesian games of Kajii and Morris [11] when attention is restricted to symmetric equilibria. Hence, by exploiting the properties of anonymous local games, it is possible to obtain stronger robustness results for this class.
A theory of strategic diffusion
, 2008
"... Friends, neighbors and colleagues play an important role in shaping individual choice. The growth of the internet and assorted technologies has made it possible to collect and process detailed information on social networks. This paper looks at how can firms (and governments) harness the power of so ..."
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Cited by 2 (1 self)
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Friends, neighbors and colleagues play an important role in shaping individual choice. The growth of the internet and assorted technologies has made it possible to collect and process detailed information on social networks. This paper looks at how can firms (and governments) harness the power of social networks to promote their goals. We show that the optimal use of social networks leads to higher sales and greater profits. However, an increase in the level and dispersion of social interaction can increase or decrease the optimal influence strategy and profits of the player, depending on the content of the interaction. Optimal influence strategies will target individuals with low or high connections, depending on the content of interaction. Finally, the returns to investing in market research on social networks are greater in more unequal networks.