Logical Differencing in Network Formation Models under Non-Transferable Utilities by Wayne Yuan Gao

Join us for this Econometrics Research Seminar, Summer Term 2021

Dr Wayne Yuan Gao from the Department of Economics, University of Pennsylvania will present their research on Logical Differencing in Network Formation Models under Non-Transferable Utilities.

Abstract

This paper considers a semiparametric model of dyadic network formation under non-transferable utilities (NTU). NTU arises frequently in real-world social interactions that require bilateral consent, but by its nature induces additive non-separability. We show how unobserved individual heterogeneity in our model can be cancelled out without additive separability, using a novel method we call logical differencing. The key idea is to construct events involving the intersection of two mutually exclusive restrictions on the unobserved heterogeneity, based on multivariate monotonicity. We provide a consistent estimator and analyse its performance via simulation, and apply our method to the Nyakatoke risk-sharing networks.

This seminar will be held via webinar on Zoom at 4pm on Wednesday 2nd June. This event is open to all levels of study and is also open to the public. To register your place and gain access to the webinar, please contact the seminar organisers.

This event is part of the Econometrics Research Seminar Series.