Testing for Externalities in Network Formation Using Simulation

• Tác giả: Bryan S Graham, Andrin Pelican
• Ngôn ngữ: eng
• Ký hiệu phân loại: 003.3 Computer modeling and simulation
• Thông tin xuất bản: 2019
• Bộ sưu tập: Metadata
• ID: 163162

Tóm tắt

Comment: 24 pagesWe discuss a simplified version of the testing problem considered by Pelican and Graham (2019): testing for interdependencies in preferences over links among N (possibly heterogeneous) agents in a network. We describe an exact test which conditions on a sufficient statistic for the nuisance parameter characterizing any agent-level heterogeneity. Employing an algorithm due to Blitzstein and Diaconis (2011), we show how to simulate the null distribution of the test statistic in order to estimate critical values and/or p-values. We illustrate our methods using the Nyakatoke risk-sharing network. We find that the transitivity of the Nyakatoke network far exceeds what can be explained by degree heterogeneity across households alone.