Essays on heterogeneity in economic networks

This dissertation contains three analyses of the role of heterogeneity in economic networks. The first model describes a durable-goods network where a monopolistic supplier has discretion over the compatibility of successive product generations. In the second model, telecommunications networks compete for final customers but cooperate in setting a reciprocal interconnection fee. In both models, consumer heterogeneity has a significant impact on outcomes and policy implications. The third model describes the effect of mergers on Shapley values in a cooperative bargaining game among heterogeneous firms, providing an explanation of merger waves based entirely on bargaining effects