Some Challenges in the Empirics of the Effects of Networks

Vincent Boucher and Bernard Fortin ()

No 8896, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We study some recent developments and challenges in the empirics of the effects of social networks. We focus in particular on researchers' ability to make policy recommendations based on a standard linear econometric model. We examine the potential compatibility between this type of econometric model and a microeconomic theoretical approach based on fundamentals, such as preferences, technology and decision processes. We discuss sources of identification for the social multiplier as well as for the identity of the key player. We study the possibility of testing endogeneity in network formation. We analyse the use of proxy variables and their impact for the causal interpretation of the peer effect coefficients. Our analysis suggests that greater care should be taken in grounding econometric network models to sound and credible theoretical underpinnings.

Keywords: proxy variables; identification; network formation; social multiplier; social networks; policy analysis (search for similar items in EconPapers)
JEL-codes: A14 C33 C36 D85 Z13 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2015-02
New Economics Papers: this item is included in nep-net, nep-soc and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

Published - published in: Oxford Handbook on the Economics of Networks, 2016, 277 - 302

Downloads: (external link)
https://docs.iza.org/dp8896.pdf (application/pdf)

Related works:
Working Paper: Some Challenges in the Empirics of the Effects of Networks (2015)
Working Paper: Some Challenges in the Empirics of the Effects of Networks (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp8896

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().