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Explaining clustering in social networks: towards an evolutionary theory of cascading benefits

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  • Sheen S. Levine

    (Management Department, Lee Kong Chian School of Business, Singapore Management University, Singapore 178899, Singapore)

  • Robert Kurzban

    (Department of Psychology, 3720 Walnut Street, University of Pennsylvania, Philadelphia, PA 19104, USA)

Abstract

Individual and organizational actors enter into a large number of relationships that include benefiting others without ensuring the equality of reciprocal benefits. We suggest that actors have evolved mechanisms that guide them in the choice of exchange partners, even without conscious calculation or bookkeeping of gain and loss. One such mechanism directs actors to membership in clusters, which are homogenous groups of actors densely connected among themselves and only loosely connected to other groups. We suggest that clusters offer network externalities, which are not possible in sparse networks, thus conferring cascading benefits on the actors contained in those clusters. Using this logic, one can understand the omnipresence of clustering in social networks of individuals and firms. We review the benefits and challenges associated with clustering and use the logic of cascading benefits to derive empirical predictions. Copyright © 2006 John Wiley & Sons, Ltd.

Suggested Citation

  • Sheen S. Levine & Robert Kurzban, 2006. "Explaining clustering in social networks: towards an evolutionary theory of cascading benefits," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 27(2-3), pages 173-187.
  • Handle: RePEc:wly:mgtdec:v:27:y:2006:i:2-3:p:173-187
    DOI: 10.1002/mde.1291
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    File URL: http://hdl.handle.net/10.1002/mde.1291
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    References listed on IDEAS

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    1. Herbert Gintis, 2000. "Strong Reciprocity and Human Sociality," UMASS Amherst Economics Working Papers 2000-02, University of Massachusetts Amherst, Department of Economics.
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    6. Joel A. C. Baum & Andrew V. Shipilov & Tim J. Rowley, 2003. "Where do small worlds come from?," Industrial and Corporate Change, Oxford University Press, vol. 12(4), pages 697-725, August.
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    8. Cameron, Lisa A, 1999. "Raising the Stakes in the Ultimatum Game: Experimental Evidence from Indonesia," Economic Inquiry, Western Economic Association International, vol. 37(1), pages 47-59, January.
    9. repec:cup:apsrev:v:87:y:1993:i:01:p:1-11_09 is not listed on IDEAS
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    Cited by:

    1. Engel, Yuval & Kaandorp, Mariëtte & Elfring, Tom, 2017. "Toward a dynamic process model of entrepreneurial networking under uncertainty," Journal of Business Venturing, Elsevier, vol. 32(1), pages 35-51.
    2. repec:eee:ijrema:v:33:y:2016:i:3:p:578-599 is not listed on IDEAS
    3. repec:eee:touman:v:50:y:2015:i:c:p:238-252 is not listed on IDEAS

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