Some Challenges in the Empirics of the Effects of Networks

Vincent Boucher and Bernard Fortin ()

Cahiers de recherche from Centre de recherche sur les risques, les enjeux économiques, et les politiques publiques

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: Social Networks; Social Multiplier; Network formation; Identification; Proxy Variables; Policy Analysis (search for similar items in EconPapers)
JEL-codes: A14 C33 C36 D85 Z13 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (19)

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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)
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Persistent link: https://EconPapers.repec.org/RePEc:lvl:crrecr:1501

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