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Networks, Crowds, and Markets

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Details

  • 332 b/w illus. 128 exercises
  • Page extent: 744 pages
  • Size: 253 x 215 mm
  • Weight: 1.31 kg

Library of Congress

  • Dewey number: 303.48/33
  • Dewey version: 22
  • LC Classification: HM851 .E24 2010
  • LC Subject headings:
    • Telecommunication--Social aspects
    • Information society

Library of Congress Record

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Hardback

 (ISBN-13: 9780521195331)

  • Published July 2010

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US $64.99
Singapore price US $69.54 (inclusive of GST)
Networks, Crowds, and Markets
Cambridge University Press
9780521195331 - Networks, Crowds, and Markets - Reasoning about a Highly Connected World - By David Easley and Jon Kleinberg
Table of Contents

Contents

Preface
xi
1         Overview
1
1.1       Aspects of Networks
2
1.2       Central Themes and Topics
7
Part I    Graph Theory and Social Networks
19
2         Graphs
21
2.1       Basic Definitions
21
2.2       Paths and Connectivity
23
2.3       Distance and Breadth-First Search
29
2.4       Network Data Sets: An Overview
35
2.5       Exercises
39
3         Strong and Weak Ties
43
3.1       Triadic Closure
44
3.2       The Strength of Weak Ties
46
3.3       Tie Strength and Network Structure in Large-Scale Data
51
3.4       Tie Strength, Social Media, and Passive Engagement
54
3.5       Closure, Structural Holes, and Social Capital
58
3.6       Advanced Material: Betweenness Measures and Graph Partitioning
62
3.7       Exercises
74
4         Networks in Their Surrounding Contexts
77
4.1       Homophily
77
4.2       Mechanisms Underlying Homophily: Selection and Social Influence
81
4.3       Affiliation
83
4.4       Tracking Link Formation in Online Data
88
4.5       A Spatial Model of Segregation
96
4.6       Exercises
103
5         Positive and Negative Relationships
107
5.1       Structural Balance
107
5.2       Characterizing the Structure of Balanced Networks
110
5.3       Applications of Structural Balance
113
5.4       A Weaker Form of Structural Balance
115
5.5       Advanced Material: Generalizing the Definition of Structural Balance
118
5.6       Exercises
132
Part II   Game Theory
137
6         Games
139
6.1       What Is a Game?
140
6.2       Reasoning about Behavior in a Game
142
6.3       Best Responses and Dominant Strategies
146
6.4       Nash Equilibrium
149
6.5       Multiple Equilibria: Coordination Games
151
6.6       Multiple Equilibria: The Hawk--Dove Game
154
6.7       Mixed Strategies
156
6.8       Mixed Strategies: Examples and Empirical Analysis
161
6.9       Pareto Optimality and Social Optimality
165
6.10      Advanced Material: Dominated Strategies and Dynamic Games
167
6.11      Exercises
179
7         Evolutionary Game Theory
189
7.1       Fitness as a Result of Interaction
190
7.2       Evolutionarily Stable Strategies
191
7.3       A General Description of Evolutionarily Stable Strategies
196
7.4       Relationship between Evolutionary and Nash Equilibria
197
7.5       Evolutionarily Stable Mixed Strategies
199
7.6       Exercises
204
8         Modeling Network Traffic Using Game Theory
207
8.1       Traffic at Equilibrium
207
8.2       Braess's Paradox
209
8.3       Advanced Material: The Social Cost of Traffic at Equilibrium
211
8.4       Exercises
219
9         Auctions
225
9.1       Types of Auctions
225
9.2       When Are Auctions Appropriate?
226
9.3       Relationships between Different Auction Formats
228
9.4       Second-Price Auctions
229
9.5       First-Price Auctions and Other Formats
232
9.6       Common Values and the Winner's Curse
233
9.7       Advanced Material: Bidding Strategies in First-Price and All-Pay Auctions
234
9.8       Exercises
242
Part III  Markets and Strategic Interaction in Networks
247
10        Matching Markets
249
10.1      Bipartite Graphs and Perfect Matchings
249
10.2      Valuations and Optimal Assignments
253
10.3      Prices and the Market-Clearing Property
255
10.4      Constructing a Set of Market-Clearing Prices
258
10.5      How Does This Relate to Single-Item Auctions?
261
10.6      Advanced Material: A Proof of the Matching Theorem
262
10.7      Exercises
270
11        Network Models of Markets with Intermediaries
277
11.1      Price Setting in Markets
277
11.2      A Model of Trade on Networks
280
11.3      Equilibria in Trading Networks
286
11.4      Further Equilibrium Phenomena: Auctions and Ripple Effects
290
11.5      Social Welfare in Trading Networks
294
11.6      Trader Profits
295
11.7      Reflections on Trade with Intermediaries
297
11.8      Exercises
297
12        Bargaining and Power in Networks
301
12.1      Power in Social Networks
301
12.2      Experimental Studies of Power and Exchange
304
12.3      Results of Network Exchange Experiments
305
12.4      A Connection to Buyer--Seller Networks
309
12.5      Modeling Two-Person Interaction: The Nash Bargaining Solution
310
12.6      Modeling Two-Person Interaction: The Ultimatum Game
312
12.7      Modeling Network Exchange: Stable Outcomes
314
12.8      Modeling Network Exchange: Balanced Outcomes
317
12.9      Advanced Material: A Game-Theoretic Approach to Bargaining
320
12.10     Exercises
327
Part IV   Information Networks and the World Wide Web
331
13        The Structure of the Web
333
13.1      The World Wide Web
333
13.2      Information Networks, Hypertext, and Associative Memory
335
13.3      The Web as a Directed Graph
340
13.4      The Bow-Tie Structure of the Web
344
13.5      The Emergence of Web 2.0
347
13.6      Exercises
349
14        Link Analysis and Web Search
351
14.1      Searching the Web: The Problem of Ranking
351
14.2      Link Analysis Using Hubs and Authorities
353
14.3      PageRank
358
14.4      Applying Link Analysis in Modern Web Search
363
14.5      Applications beyond the Web
366
14.6      Advanced Material: Spectral Analysis, Random Walks, and Web Search
368
14.7      Exercises
378
15        Sponsored Search Markets
385
15.1      Advertising Tied to Search Behavior
385
15.2      Advertising as a Matching Market
388
15.3      Encouraging Truthful Bidding in Matching Markets: The VCG Principle
391
15.4      Analyzing the VCG Mechanism: Truth-Telling as a Dominant Strategy
395
15.5      The Generalized Second-Price Auction
398
15.6      Equilibria of the Generalized Second-Price Auction
401
15.7      Ad Quality
404
15.8      Complex Queries and Interactions among Keywords
406
15.9      Advanced Material: VCG Prices and the Market-Clearing Property
407
15.10     Exercises
420
Part V    Network Dynamics: Population Models
423
16        Information Cascades
425
16.1      Following the Crowd
425
16.2      A Simple Herding Experiment
427
16.3      Bayes' Rule: A Model of Decision Making under Uncertainty
430
16.4      Bayes' Rule in the Herding Experiment
434
16.5      A Simple, General Cascade Model
436
16.6      Sequential Decision Making and Cascades
440
16.7      Lessons from Cascades
442
16.8      Exercises
444
17        Network Effects
449
17.1      The Economy without Network Effects
450
17.2      The Economy with Network Effects
453
17.3      Stability, Instability, and Tipping Points
456
17.4      A Dynamic View of the Market
457
17.5      Industries with Network Goods
462
17.6      Mixing Individual Effects with Population-Level Effects
465
17.7      Advanced Material: Negative Externalities and the El Farol Bar Problem
470
17.8      Exercises
476
18        Power Laws and Rich-Get-Richer Phenomena
479
18.1      Popularity as a Network Phenomenon
479
18.2      Power Laws
481
18.3      Rich-Get-Richer Models
482
18.4      The Unpredictability of Rich-Get-Richer Effects
484
18.5      The Long Tail
486
18.6      The Effect of Search Tools and Recommendation Systems
489
18.7      Advanced Material: Analysis of Rich-Get-Richer Processes
490
18.8      Exercises
493
Part VI   Network Dynamics: Structural Models
495
19        Cascading Behavior in Networks
497
19.1      Diffusion in Networks
497
19.2      Modeling Diffusion through a Network
499
19.3      Cascades and Clusters
506
19.4      Diffusion, Thresholds, and the Role of Weak Ties
509
19.5      Extensions of the Basic Cascade Model
512
19.6      Knowledge, Thresholds, and Collective Action
514
19.7      Advanced Material: The Cascade Capacity
517
19.8      Exercises
532
20        The Small-World Phenomenon
537
20.1      Six Degrees of Separation
537
20.2      Structure and Randomness
538
20.3      Decentralized Search
541
20.4      Modeling the Process of Decentralized Search
543
20.5      Empirical Analysis and Generalized Models
546
20.6      Core--Periphery Structures and Difficulties in Decentralized Search
552
20.7      Advanced Material: Analysis of Decentralized Search
554
20.8      Exercises
564
21        Epidemics
567
21.1      Diseases and the Networks That Transmit Them
567
21.2      Branching Processes
569
21.3      The SIR Epidemic Model
572
21.4      The SIS Epidemic Model
576
21.5      Synchronization
578
21.6      Transient Contacts and the Dangers of Concurrency
582
21.7      Genealogy, Genetic Inheritance, and Mitochondrial Eve
585
21.8      Advanced Material: Analysis of Branching and Coalescent Processes
590
21.9      Exercises
602
Part VII  Institutions and Aggregate Behavior
605
22        Markets and Information
607
22.1      Markets with Exogenous Events
608
22.2      Horse Races, Betting, and Beliefs
609
22.3      Aggregate Beliefs and the “Wisdom of Crowds”
615
22.4      Prediction Markets and Stock Markets
618
22.5      Markets with Endogenous Events
622
22.6      The Market for Lemons
623
22.7      Asymmetric Information in Other Markets
627
22.8      Signaling Quality
631
22.9      Quality Uncertainty Online: Reputation Systems and Other Mechanisms
632
22.10     Advanced Material: Wealth Dynamics in Markets
635
22.11     Exercises
641
23        Voting
645
23.1      Voting for Group Decision Making
645
23.2      Individual Preferences
646
23.3      Voting Systems: Majority Rule
649
23.4      Voting Systems: Positional Voting
654
23.5      Arrow's Impossibility Theorem
657
23.6      Single-Peaked Preferences and the Median Voter Theorem
658
23.7      Voting as a Form of Information Aggregation
663
23.8      Insincere Voting for Information Aggregation
665
23.9      Jury Decisions and the Unanimity Rule
668
23.10     Sequential Voting and the Relation to Information Cascades
672
23.11     Advanced Material: A Proof of Arrow's Impossibility Theorem
673
23.12     Exercises
678
24        Property Rights
681
24.1      Externalities and the Coase Theorem
681
24.2      The Tragedy of the Commons
685
24.3      Intellectual Property
688
24.4      Exercises
691
Bibliography
693
Index
711



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