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Meeting friends of friends and homophily: a complementarity

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  • Adrien Vigier

    (University of Oslo)

Abstract

I explore the effects of homophily on the formation of social networks. When individuals are homophilous, friends of friends are likely to share tastes and hence also likely to form new friendships. In the context of homophily, the social network dynamics of meeting friends of friends thus acts as directed search, and a greater number of meetings result in links being formed. However, since it exacerbates preferential attachment—whereby high degree nodes attract new links—homophily also causes more unequal distributions of links. Thus while homophily normally improves social welfare, for a given average number of links formed it in fact affects welfare negatively.

Suggested Citation

  • Adrien Vigier, 2014. "Meeting friends of friends and homophily: a complementarity," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 2(1), pages 45-52, April.
    • Handle: RePEc:spr:etbull:v:2:y:2014:i:1:d:10.1007_s40505-013-0025-1
    DOI: 10.1007/s40505-013-0025-1
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    References listed on IDEAS

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    1. Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521857406.
    2. Sergio Currarini & Matthew O. Jackson & Paolo Pin, 2009. "An Economic Model of Friendship: Homophily, Minorities, and Segregation," Econometrica, Econometric Society, vol. 77(4), pages 1003-1045, July.
    3. Benjamin Golub & Matthew O. Jackson, 2012. "How Homophily Affects the Speed of Learning and Best-Response Dynamics," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(3), pages 1287-1338.
    4. Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521674096.
    5. Matthew O. Jackson & Brian W. Rogers, 2007. "Meeting Strangers and Friends of Friends: How Random Are Social Networks?," American Economic Review, American Economic Association, vol. 97(3), pages 890-915, June.
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    Cited by:

    1. , David, 2016. "The formation of networks with local spillovers and limited observability," Theoretical Economics, Econometric Society, vol. 11(3), September.

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    More about this item

    Keywords

    Social networks; Network formation; Homophily;
    All these keywords.

    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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