Homophily, the tendency of linked agents to have similar characteristics, is an im- portant feature of social networks. We present a new model of network formation that allows the linking process to depend on individuals types and study the impact of such a bias on the network structure. Our main results fall into three categories: (i) we compare the distributions of intra- and inter-group links in terms of stochastic dominance, (ii) we show how, at the group level, homophily depends on the groups size and the details of the formation process, and (iii) we understand precisely the determinants of local homophily at the individual level. Especially, we ¯nd that popular individuals have more diverse networks. Our results are supported empirically in the AddHealth data looking at networks of social connections between boys and girls.
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Paper provided by Northwestern University, Center for Mathematical Studies in Economics and Management Science in its series Discussion Papers with number
1475.
Length: Date of creation: Jan 2009 Date of revision: Handle: RePEc:nwu:cmsems:1475
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