We study non-cooperative link formation games in which players have to
decide how much to invest in relationships with other players. A link
between two players is formed, if and only if both make a positive
investment. The cost of forming a link can be interpreted as the value
of privacy. We analyze the existence of pure strategy equilibria and the
resulting network structures with tractable specifications of utility
functions. Sufficient conditions for the existence of reciprocal
equilibria are given and the corresponding network structure is
analyzed. Pareto optimal and strongly stable network structures are
studied. It turns out that such networks are often complete.