Cavalcanti, Tiago V. V.
Johnson, Charles R.
- Publisher: Springer Nature
consensus | convergence | endogenous growth models | network theory | Economics and Econometrics
This is the final version of the article. It first appeared from Springer via http://dx.doi.org/10.1007/s00199-016-0992-1
We define a measure of network cohesion and show how it arises naturally in a broad class of dynamic models of endogenous perpetual growth with network externalities. Via a standard growth model, we show why network cohesion is crucial for conditional convergence and explain that as cohesion increases, convergence is faster. We prove properties of network cohesion and define a network aggregator that preserves network cohesion.