Social Network Structure and The Trade-Off Between Social Utility and Economic Performance

Katarzyna Growiec, Jakub Growiec and Bogumił Kamiński

No 2017-026, KAE Working Papers from Warsaw School of Economics, Collegium of Economic Analysis

Abstract: Based on a novel computational multi-agent model, we identify the keymechanisms allowing the social network structure, summarized by four key socialcapital dimensions (network degree, centrality, bridging and bonding social capital), to affect individuals' social trust, willingness to cooperate, social utility and economicperformance. We then trace how the individual-level outcomes aggregate up to thesociety level. Model setup draws from socio-economic theory and empirical findings based on our novel survey dataset. Results include aggregate-level comparative staticsand individual-level correlations. We find, inter alia, that societies that either arebetter connected, exhibit a lower frequency of local cliques, or have a smaller share offamily-based cliques, record relatively better economic performance. As long as familyties are sufficiently valuable, there is a trade-off between aggregate social utility andeconomic performance, and small world networks are then socially optimal.

Keywords: social network structure; social trust; willingness to cooperate; economicperformance; computational multi-agent model (search for similar items in EconPapers)
JEL-codes: C63 D85 J31 L14 Z13 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2017-03
New Economics Papers: this item is included in nep-cmp, nep-net, nep-soc and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Social Network Structure and The Trade-Off Between Social Utility and Economic Performance (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:sgh:kaewps:2017026

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