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Networks of information exchange: Are link formation decisions strategic?

Pritha Dev

Economics Letters, 2018, vol. 162, issue C, 86-92

Abstract: This paper presents an empirical investigation into whether the decision to form a link with a node takes into account how well connected that node is. Given data in the form of a random sample from a network, this paper proposes a novel way to measure the degree of a node to adjust for mismeasurement and also controls for the endogeneity of this variable. It is shown that in fact the probability of forming a link with a node is increasing in the links received by that node but decreasing or unaffected by the links made by that node.

Keywords: Network; Degree; Mismeasurement; Binary choice with endogeneity (search for similar items in EconPapers)
JEL-codes: D83 (search for similar items in EconPapers)
Date: 2018
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Handle: RePEc:eee:ecolet:v:162:y:2018:i:c:p:86-92