ATTRACTORS AND REPELLORS: A GAME THEORETIC INTERPRETATION OF THE CYCLES IN PROVIDER-CUSTOMER RELATIONS

摘要

Recent studies on the evolution of the Internet ecosystem found evidence of cycles inconnectivity between operators. In this paper, connectivity cycles emerge from theimperfect ability of the Providers of Internet connectivity to monitor their Customers’actions in a repeated game setting characterised by information asymmetry. Providersintroduce temporary punishments, spells of dewiring, with the purpose to reduce theCustomer’s incentives to free ride on their connectivity links. We estimate aneconometric model focussing on the determinants of the length of the punishmentphases and on the probability of their occurrence, both necessary features to ensurethat connectivity, although discontinuously, remains a feature along the equilibrium pathof the repeated connectivity game. Asymmetry between Customer and Providers,shaping their period incentives to deviate and the history of past connectivity, affectingtrust and the information asymmetries, are the main factors in determining the lengthand occurrence of the Repellence phases.