DP11452 Networks: An economic perspective

Author(s): Matthew O. Jackson, Brian Rogers, Yves Zenou
Publication Date: August 2016
Keyword(s): economic networks, externalities, Game theory, network formation, network games, Networks, peer effects, Social Networks
JEL(s): C72, D85, L14, Z13
Programme Areas: Public Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=11452

We discuss social network analysis from the perspective of economics. We organize the presentation around the theme of externalities: the effects that one's behavior has on others' welfare. Externalities underlie the interdependencies that make networks interesting to social scientists. We discuss network formation, as well as interactions between peoples' behaviors within a given network, and the implications in a variety of settings. Finally, we highlight some empirical challenges inherent in the statistical analysis of network-based data.