On the windfall of friendship

Abstract

This paper studies a virus inoculation game on social networks. A framework is presented which allows the measuring of the windfall of friendship, i.e., how much players benefit if they care about the welfare of their direct neighbors in the social network graph compared to purely selfish environments. We analyze the corresponding equilibria and show that the computation of the worst and best Nash equilibrium is NP-hard. Intriguingly, even though the windfall of friendship can never be negative, the social welfare does not increase monotonically with the extent to which players care for each other. While these phenomena are known on an anecdotal level, our framework allows us to quantify these effects analytically.

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