Equilibrium homophily in networks

Boucher, Vincent

doi:10.1016/j.euroecorev.2020.103370

European Economic Review

2020

DOI: 10.1016/j.euroecorev.2020.103370

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Equilibrium homophily in networks

Vincent Boucher

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2021

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Cited by 1 publication

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Endogenous Social Interactions with Unobserved Networks

Battaglini

Patacchini

Rainone

2021

The Review of Economic Studies

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We present a model of endogenous network formation to recover unobserved social networks using only observable outcomes. We propose a novel equilibrium concept that allows for a sharp characterization of equilibrium behavior and that yields a unique prediction under testable conditions. While the equilibrium is characterized by a large number of nonlinear equations, we show that it can be efficiently employed to recover the networks by an appropriately designed approximate Bayesian computation method. We apply the model to recover the network of social links between lawmakers in the U.S. Congress using data from the 109th to 113th legislatures. We show that social connections are important for legislators’ productivities and we identify some of the key determinants of network centralities in the U.S. Congress.

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Endogenous Social Interactions with Unobserved Networks

Battaglini

Patacchini

Rainone

2021

The Review of Economic Studies

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show abstract

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Equilibrium homophily in networks

Cited by 1 publication

References 70 publications

Endogenous Social Interactions with Unobserved Networks

Endogenous Social Interactions with Unobserved Networks

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