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Getting Closer or Drifting Apart

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  • Mobius, Markus
  • Rosenblat, Tanya

Abstract

Advances in communication and transportation technologies have the potential to bring people closer together and create a "global village." However, they also allow heterogeneous agents to segregate along special interests, which gives rise to communities fragmented by type rather than by geography. We show that lower communication costs should always decrease separation between individual agents even as group-based separation increases. Each measure of separation is pertinent for distinct types of social interaction. A group-based measure captures the diversity of group preferences that can have an impact on the provision of public goods. While an individual measure correlates with the speed of information transmission through the social network that affects, for example, learning about job opportunities and new technologies. We test the model by looking at coauthoring between academic economists before and during the rise of the Internet in the 1990s.

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  • Mobius, Markus & Rosenblat, Tanya, 2004. "Getting Closer or Drifting Apart," Scholarly Articles 3043419, Harvard University Department of Economics.
    • Handle: RePEc:hrv:faseco:3043419
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    References listed on IDEAS

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    1. Sanjeev Goyal & Marco J. van der Leij & José Luis Moraga-Gonzalez, 2006. "Economics: An Emerging Small World," Journal of Political Economy, University of Chicago Press, vol. 114(2), pages 403-432, April.
    2. Alberto Alesina & Reza Baqir & William Easterly, 1999. "Public Goods and Ethnic Divisions," The Quarterly Journal of Economics, Oxford University Press, vol. 114(4), pages 1243-1284.
    3. Giorgio Topa, 2001. "Social Interactions, Local Spillovers and Unemployment," Review of Economic Studies, Oxford University Press, vol. 68(2), pages 261-295.
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