Testing unilateral and bilateral link formation
We propose a test of whether self-reported network data is best seen as an actual link or willingness to link and, in the latter case, whether this link is generated by an unilateral or bilateral link formation process. We illustrate this test using survey answers to a risk-sharing question in an African village. We find that bilateral link formation fits the data better than unilateral link formation, but the data are best interpreted as willingness to link rather than an actual link. We then expand the model to include self-censoring and find it to fit the data significantly better than willingness to link. This suggests that, in our data, the data generating process behind self-reported links is a hybrid between an actual link and willingness to link.
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- Stefan Dercon & Joachim De Weerdt, 2002.
"Risk-sharing Networks and Insurance against illness,"
Economics Series Working Papers
WPS/2002-16, University of Oxford, Department of Economics.
- De Weerdt, Joachim & Dercon, Stefan, 2006. "Risk-sharing networks and insurance against illness," Journal of Development Economics, Elsevier, vol. 81(2), pages 337-356, December.
- Stefan Dercon & Joachim De Weerdt, 2002. "Risk-sharing networks and insurance against illness," CSAE Working Paper Series 2002-16, Centre for the Study of African Economies, University of Oxford.
- Stefan Dercon & Joachim de Weerdt, 2004. "Risk-Sharing Networks And Insurance Against Illness," Development and Comp Systems 0409019, EconWPA.
- Guenter Hitsch & Ali Hortacsu, 2005. "What Makes You Click? An Empirical Analysis of Online Dating," 2005 Meeting Papers 207, Society for Economic Dynamics.
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