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We study models of the formation of citation networks in a setting where authors/firms care about their citations and are rational. The effect of these two features on the diffusion of useful ideas in a setting with complete information about past citations leads to multiplicity of equilibria. With field-specific norms, however, uniqueness obtains. Asymmetric information about quality may lead to earlier citations and the combination of asymmetric information about quality and strategic entry gives equilibria in which players signal quality by timing of entry. Ex post efficiency cannot be guaranteed, but ex ante efficiency is sometimes attainable.

Formation of Citation Networks by Rational Players and The Diffusion of Ideas