How to Measure Political Connection in the Directors’ Network

Informal social contract such as political connection plays a significant role for directors' network but difficult to explore their role through traditional measures. Different social network measures labelled as “centralities” have previously been used in the network analysis community to find influential nodes in a network. It is debatable how valid these centrality measures for the political connection are. This paper aims not only to identify the political connection through social network analysis but to analyze the different levels of political connection through different centrality measures according to the country's institutional environment. For this purpose, we used data from a relationship-based economy like Pakistan from 2009 to 2015. We analyze the five different levels of political connection and examine their role through five social network measures: degree, closeness centrality, betweenness centrality, eigenvector, and eccentricity. Our finding demonstrates that degree, betweenness centrality, and eigenvector are not suitable measures for political connection role and control in the directors’ network. Closeness centrality gives a better understanding of how other directors are closed to politically connected directors and which level of political connection attracts the other directors but couldn’t explain how far a political director can access. We found eccentricity as the most suitable measure for the political connection and their different role. We also found the federal and provincial level political connections become more central and important through the eccentricity measure after the regime's shift from autocratic to democratic.