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Homophily in preferences or meetings? Identifying and estimating an iterative network formation model

Luis Alvarez, Cristine Pinto, Vladimir Ponczek

arXiv 18 Jan 2022 · Econometrics

arXiv:2201.06694 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Is homophily in social and economic networks driven by a taste for homogeneity (preferences) or by a higher probability of meeting individuals with similar attributes (opportunity)? This paper studies identification and estimation of an iterative network game that distinguishes between these two mechanisms. Our approach enables us to assess the counterfactual effects of changing the meeting protocol between agents. As an application, we study the role of preferences and meetings in shaping classroom friendship networks in Brazil. In a network structure in which homophily due to preferences is stronger than homophily due to meeting opportunities, tracking students may improve welfare. Still, the relative benefit of this policy diminishes over the school year.

Citation extraction

62
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distinct cited
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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Barthelmé, S. and N. Chopin (2014) Expectation propagation for likelihood-free inference1.00063100%
2Mele, A (2017) A structural model of dense network formation0.92419579%
3Chetty, R., M. O. Jackson, T. Kuchler, J. Stroebel, N. Hendren, R. B… (2022) Social capital ii: determinants of economic connectedness0.81142100%
4Jackson, M (2010) Social and Economic Networks0.81142100%
5Pinto, C. C. d. X. and V. P. Ponczek (2023) The building blocks of skill development self0.81142100%
6Badev, A (2021) Nash equilibria on (un)stable networks0.73732100%
7Frazier, D. T., G. M. Martin, C. P. Robert, and J. Rousseau (2018) Asymptotic properties of approximate Bayesian computation0.73732100%
8Currarini, S., M. O. Jackson, and P. Pin (2009) An economic model of friendship: Homophily, minorities, and segregation0.64441100%
9Li, W. and P. Fearnhead (2018) On the asymptotic efficiency of approximate Bayesian computation estimators0.64441100%
10Barthelmé, S., N. Chopin, and V. Cottet (2018) Divide and conquer in ABC: Expectation-propagation algorithms for likelihood-free inference0.64422100%

Showing the top 10 of 62 scored citations.