On the emergence of scale-free production networks

Stanislao Gualdi; Antoine Mandel

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arXiv · 1509.01483

On the emergence of scale-free production networks

Stanislao Gualdi·Antoine Mandel

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Abstract

We propose a simple dynamical model of the formation of production networks among monopolistically competitive firms. The model subsumes the standard general equilibrium approach \`a la Arrow-Debreu but displays a wide set of potential dynamic behaviors. It robustly reproduces key stylized facts of firms' demographics. Our main result is that competition between intermediate good producers generically leads to the emergence of scale-free production networks.

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Stanislao Gualdi, Antoine Mandel. 2015-09-03. On the emergence of scale-free production networks. https://arxiv.org/abs/1509.01483

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