During the past two decades there has emerged an extensive literature on game-theoretic models of network formation. Seminally, the fundamentals of such a game-theoretic perspective were set out by  in which players are guided by the Myerson value of corresponding communication situations. This contribution explored network formation under mutual consent through a non-cooperative signalling game: A link between two players is formed if and only if both players signal to each other their willingness to form this relationship. The main insight of the Myerson model  is that the network without any links is always supported through a Nash equilibrium of this signalling game. This theoretical result leads to the conclusion that network formation under mutual consent has to be considered as difficult, even impossible. This would contradict the well-established understanding of human nature as that of a social networker.
|Title of host publication||Game Theory and Networks. New Perspectives and Directions|
|Editors||Surajit Borkotokey, Rajnish Kumar, Diganta Mukherjee, K. S. Mallikarjuna Rao, Sudipta Sarangi|
|Publication status||Published - 01 Jan 2022|
|Name||Indian Statistical Institute Series|