Observing Cascade Behavior Depending on the Network Topology and Transaction Costs

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dc.contributor.authorKim, Joohyun
dc.contributor.authorKwon, Ohsung
dc.contributor.authorLee, Duk Hee
dc.contributor.utdAuthorKim, Joohyun
dc.date.accessioned2020-05-22T22:41:37Z
dc.date.available2020-05-22T22:41:37Z
dc.date.issued2019-01-31
dc.descriptionDue to copyright restrictions and/or publisher's policy full text access from Treasures at UT Dallas is limited to current UTD affiliates (use the provided Link to Article).
dc.description.abstractThe Internet, smartphones, Social Networking Service, and other IT goods have improved the overall quality of life, but created an over-connectedness with extremely low transaction costs in our society, amplifying latent social problems. In light of this, we demonstrate the main mechanism of information cascades in various network topologies using computational model that can consider autonomous agents, the adoption of others' decisions, and network topologies. Our findings reveal that: (1) lower transaction costs may amplify the occurrence of information cascades; (2) the network structure significantly affects the behavior of traders in terms of the individual and the whole market; and (3) highly spread trend-shift cascades can be observed in scale-free networks when the influence of a dominant agent's decision significantly affects the connected agents. Such findings highlight how a highly over-connected network has its critical shortcomings.
dc.description.departmentNaveen Jindal School of Management
dc.description.sponsorshipNational Science Foundation (DMS-1612880) and by the National Research Foundation of Korea Grant funded by Korean Government (2014S1A3A2044459)
dc.identifier.bibliographicCitationKim, Joohyun, Ohsung Kwon, and Duk Hee Lee. 2019. "Observing Cascade Behavior Depending on the Network Topology and Transaction Costs." Computational Economics 53(1): 207-225, doi: 10.1007/s10614-017-9738-9
dc.identifier.issn0927-7099
dc.identifier.issue1
dc.identifier.urihttp://dx.doi.org/10.1007/s10614-017-9738-9
dc.identifier.urihttps://hdl.handle.net/10735.1/8653
dc.identifier.volume53
dc.language.isoen
dc.publisherSpringer
dc.rights©2019 Springer Nature Switzerland AG.
dc.source.journalComputational Economics
dc.subjectTransaction costs
dc.subjectElectric network topology
dc.subjectHerding
dc.subjectMarketing research
dc.subjectDiffusion
dc.subjectEconomic impact analysis
dc.subjectCentrality (Graph theory)
dc.subjectInternet
dc.subjectManagerial economics
dc.subjectMathematics
dc.titleObserving Cascade Behavior Depending on the Network Topology and Transaction Costs
dc.type.genrearticle

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