Working Paper: CEPR ID: DP11452
Authors: Matthew O. Jackson; Brian Rogers; Yves Zenou
Abstract: We discuss social network analysis from the perspective of economics. We organize the presentation around the theme of externalities: the effects that one’s behavior has on others’ welfare. Externalities underlie the interdependencies that make networks interesting to social scientists. We discuss network formation, as well as interactions between peoples’ behaviors within a given network, and the implications in a variety of settings. Finally, we highlight some empirical challenges inherent in the statistical analysis of network-based data.
Keywords: networks; social networks; economic networks; network games; peer effects; game theory; network formation; externalities
JEL Codes: D85; L14; Z13; C72
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| social networks (Z13) | educational outcomes (I26) |
| social networks (Z13) | labor market outcomes (J48) |
| individuals' positions within networks (D85) | access to information (L86) |
| individuals' positions within networks (D85) | access to opportunities (I24) |
| homophily (C92) | reinforce existing inequalities (I24) |
| poorly employed contacts (J68) | learn about job opportunities (J68) |
| poorly connected individuals (D85) | competition for job opportunities (J68) |
| relationship choices (D71) | societal impacts (F69) |
| positive externalities (D62) | knowledge sharing (O36) |
| negative externalities (D62) | competition for job opportunities (J68) |