  We introduce a heterogeneous connection model for network formation to
capture the effect of cost heterogeneity on the structure of efficient
networks. In the proposed model, connection costs are assumed to be separable,
which means the total connection cost for each agent is uniquely proportional
to its degree. For these sets of networks, we provide the analytical solution
for the efficient network and discuss stability impli- cations. We show that
the efficient network exhibits a core-periphery structure, and for a given
density, we find a lower bound for clustering coefficient of the efficient
network.
