Title: A Strategic Theory of Network Status

Speaker: Brian Rogers

We study a model of network formation in the context of information aggregation. Agents receive private information about a payoff-relevant state variable. Before agents make individual decisions, signals can be credibly communicated to other agents. The choices about with whom to communicate are represented by the formation of costly binary links, for which mutual consent is required. We identify structural properties of stable networks, and characterize when they exist. First, ex ante identical agents receive heterogeneous amounts of information in equilibrium. Second, better-informed agents tend to be connected to other better-informed agents. We compare these networks to those that are informationally efficient.