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A note on network structure: functional relationships between network indicators

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  • Wegberg Marc van

    (METEOR)

Abstract

Two important aspects of network structure are network density and network centrality. These two aspects highlight different characteristics of a network. Empirical studies tend to find that one or the other is the better explanatory variable for certain aspects of corporate behaviour. This note makes a simple and compelling point. There is a hill-shaped relationship between network density and network centrality. A purely stochastic process of alliance formation will lead to a hill-shaped relationship. A mathematical, functional relationship can be shown between network density and the upper bound to network centrality. The combination of these outcomes sets lower and upper bounds on network centrality. This approach can offer a vantage point for an evolutionary study of network structure.

Suggested Citation

  • Wegberg Marc van, 2003. "A note on network structure: functional relationships between network indicators," Research Memorandum 049, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  • Handle: RePEc:unm:umamet:2003049
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    References listed on IDEAS

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    1. Riccaboni, Massimo & Pammolli, Fabio, 2002. "On firm growth in networks," Research Policy, Elsevier, vol. 31(8-9), pages 1405-1416, December.
    2. Bonaccorsi, Andrea & Giuri, Paola, 2001. "Network structure and industrial dynamics. The long-term evolution of the aircraft-engine industry," Structural Change and Economic Dynamics, Elsevier, vol. 12(2), pages 201-233, July.
    3. John Sutton, 1997. "Gibrat's Legacy," Journal of Economic Literature, American Economic Association, vol. 35(1), pages 40-59, March.
    4. Kogut, Bruce & Walker, Gordon & Kim, Dong-Jae, 1995. "Cooperation and entry induction as an extension of technological rivalry," Research Policy, Elsevier, vol. 24(1), pages 77-95, January.
    5. Orsenigo, L. & Pammolli, F. & Riccaboni, Massimo, 2001. "Technological change and network dynamics: Lessons from the pharmaceutical industry," Research Policy, Elsevier, vol. 30(3), pages 485-508, March.
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    Keywords

    Economics ;

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