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What is Network Formation in Game Theory?

Network formation in game theory refers to the study of how connections and relationships evolve among rational decision-makers within a system. In this context, individuals or entities strategically establish connections with others to maximize their utility or achieve certain objectives. This field examines various models and structures of networks, analyzing factors such as trust, influence, and benefits to understand the dynamics of network formation. It finds applications in diverse domains, including social networks, economic ecosystems, and communication networks.

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