Social and Economic Networks

Social and Economic Networks

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Networks of relationships help determine the careers that people choose, the jobs they obtain, the products they buy, and how they vote. The many aspects of our lives that are governed by social networks make it critical to understand how they impact behavior, which network structures are likely to emerge in a society, and why we organize ourselves as we do. In Social and Economic Networks, Matthew Jackson offers a comprehensive introduction to social and economic networks, drawing on the latest findings in economics, sociology, computer science, physics, and mathematics. He provides empirical background on networks and the regularities that they exhibit, and discusses random graph-based models and strategic models of network formation. He helps readers to understand behavior in networked societies, with a detailed analysis of learning and diffusion in networks, decision making by individuals who are influenced by their social neighbors, game theory and markets on networks, and a host of related subjects. Jackson also describes the varied statistical and modeling techniques used to analyze social networks.
Each chapter includes exercises to aid students in their analysis of how networks function. This book is an indispensable resource for students and researchers in economics, mathematics, physics, sociology, and business.
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Product details

  • Paperback | 520 pages
  • 178 x 254 x 27.94mm | 822g
  • New Jersey, United States
  • English
  • 114 line illus. 10 tables.
  • 0691148201
  • 9780691148205
  • 178,458

Back cover copy

"The study of networks is one of the liveliest and most interesting topics in contemporary economic theory. In this timely and beautifully written book, Matthew Jackson--a leading theorist and pioneer in network theory--lucidly lays out the elements of the theory as well as some cutting-edge research."--Eric S. Maskin, Nobel Laureate in Economics

"Lucid and comprehensive, Jackson's book elegantly synthesizes several important strands of network science from sociology, physics, mathematics, computer science, and economics. It will be an immensely useful reference for researchers and students alike."--Duncan Watts, Columbia University

"Matt Jackson has met and exceeded the challenge of producing a landmark work in a rapidly emerging and highly interdisciplinary field. It is wonderfully written, expertly balancing motivation and examples with technical detail. It should become a treasured resource for members of several research communities, including economists, sociologists, and computer scientists."--Michael Kearns, University of Pennsylvania

"Jackson does justice to the vast interdisciplinary field of complex systems by bringing together the key advances scattered in the social science, physics, mathematics, computer science, and economics literature. With its comprehensive exposition and numerous fascinating examples, this is a must-read for everybody interested in social and economic networks."--Albert-László Barabási, University of Notre Dame

"This book is an eye-opener. In addition to describing the new models of small-world and scale-free networks first developed by physical scientists, it also reveals the fascinating work done by economists on social networks. It is the best available textbook on network models, containing well-thought-out and demanding problems at the end of every chapter."--Phillip Bonacich, University of California, Los Angeles

"This is an excellent, incredible, and much-needed book. Every incoming graduate student who deals with networks in economics, political science, or sociology will want it as a reference. Social and Economic Networks will become the book in formal network analysis in the social sciences. Its clarity is unsurpassed, and perhaps even unsurpassable."--Scott E. Page, author of The Difference

"This is a wonderful book on social networks that will be immensely successful both as a reference on the state of the art and as a textbook for advanced courses. I believe that this book will spur renewed interest in social and economic networks, and serve as an inspiration for many researchers. Fascinating and very pleasant to read."--Francis Bloch, école Polytechnique
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Table of contents

Preface xi PART I: BACKGROUND AND FUNDAMENTALS OF NETWORK ANALYSIS Chapter 1 Introduction 3 1.1 Why Model Networks? 3 1.2 A Set of Examples 4 1.3 Exercises 17 Chapter 2: Representing and Measuring Networks 20 2.1 Representing Networks 20 2.2 Some Summary Statistics and Characteristics of Networks 30 2.3 Appendix: Basic Graph Theory 43 2.4 Appendix: Eigenvectors and Eigenvalues 49 2.5 Exercises 51 Chapter 3: Empirical Background on Social and Economic Networks 54 3.1 The Prevalence of Social Networks 55 3.2 Observations on the Structure of Networks 56 PART II: MODELS OF NETWORK FORMATION Chapter 4: Random-Graph Models of Networks 77 4.1 Static Random-Graph Models of Random Networks 78 4.2 Properties of Random Networks 86 4.3 An Application: Contagion and Diffusion 105 4.4 Distribution of Component Sizes 107 4.5 Appendix: Useful Facts, Tools, and Theorems 110 4.6 Exercises 121 Chapter 5: Growing Random Networks 124 5.1 Uniform Randomness: An Exponential Degree Distribution 125 5.2 Preferential Attachment 130 5.3 Hybrid Models 134 5.4 Small Worlds, Clustering, and Assortativity 141 5.5 Exercises 150 Chapter 6: Strategic Network Formation 153 6.1 Pairwise Stability 154 6.2 Efficient Networks 157 6.3 Distance-Based Utility 159 6.4 A Coauthor Model and Negative Externalities 166 6.5 Small Worlds in an Islands-Connections Model 170 6.6 A General Tension between Stability and Efficiency 173 6.7 Exercises 179 PART III: IMPLICATIONS OF NETWORK STRUCTURE Chapter 7: Diffusion through Networks 185 7.1 Background: The Bass Model 187 7.2 Spread of Information and Disease 189 7.3 Search and Navigation on Networks 209 7.4 Exercises 221 Chapter 8: Learning and Networks 223 8.1 Early Theory and Opinion Leaders 224 8.2 Bayesian and Observational Learning 225 8.3 Imitation and Social Influence Models: The DeGroot Model 228 8.4 Exercises 253 Chapter 9: Decisions, Behavior, and Games on Networks 257 9.1 Decisions and Social Interaction 258 9.2 Graphical Games 269 9.3 Semi-Anonymous Graphical Games 273 9.4 Randomly Chosen Neighbors and Network Games 279 9.5 Richer Action Spaces 286 9.6 Dynamic Behavior and Contagion 293 9.7 Multiple Equilibria and Diffusion in Network Games 297 9.8 Computing Equilibria 304 9.9 Appendix: A Primer on Noncooperative Game Theory 308 9.10 Exercises 319 Chapter 10: Networked Markets 327 10.1 Social Embeddedness of Markets and Exchange 328 10.2 Networks in Labor Markets 334 10.3 Models of Networked Markets 353 10.4 Concluding Remarks 365 10.5 Exercises 366 PART IV: METHODS, TOOLS, AND EMPIRICAL ANALYSES Chapter 11: Game-Theoretic Modeling of Network Formation 371 11.1 Defining Stability and Equilibrium 372 11.2 The Existence of Stable Networks 377 11.3 Directed Networks 383 11.4 Stochastic Strategic Models of Network Formation 388 11.5 Farsighted Network Formation 395 11.6 Transfers and Network Formation 399 11.7 Weighted Network Formation 402 11.8 Agent-Based Modeling 406 11.9 Exercises 407 Chapter 12: Allocation Rules, Networks, and Cooperative Games 411 12.1 Cooperative Game Theory 412 12.2 Communication Games 416 12.3 Networks and Allocation Rules 419 12.4 Allocation Rules When Networks Are Formed 425 12.5 Concluding Remarks 430 12.6 Exercises 430 Chapter 13: Observing and Measuring Social Interaction 434 13.1 Specification and Identification 435 13.2 Community Structures, Block Models, and Latent Spaces 443 13.3 Exercises 457 Afterword 459 Bibliography 461 Index 491
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Review quote

Honorable Mention for the 2008 PROSE Award in Economics, Association of American Publishers "Jackson's review of diffusion models is excellent, as tight an overview of these models as I have seen anywhere... Social and Economic Networks is a must-read for all those steeped in the traditional social network analysis paradigm. Economists will find Jackson offers them a superb and accessible introduction to network questions and models. And for others from any social science background curious about social networks, I recommend a careful read of the book."--David Krackhardt, Science "This book deserves the highest recommendations for all readers interested in networks and interdependence. It is written clearly, and could be used both as a starting textbook for a journey to the world of networks and also as an expert guide for scientists studying social and economic networks."--Karoly Takacs, Journal of Artificial Societies and Social Simulation "I strongly recommend this book to any scholar or student interested in networks, not only in economics but in any connected field such as sociology, physics, and applied mathematics. Matthew Jackson's guided tour of the literature on economic and social networks is superb."--Joan de Marti Beltran, Regional Science and Urban Economics "[T]his is a valuable book that raises crucial questions for today's sociologist interested in social networks."--Paola Tubaro, Sociology
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About Matthew O. Jackson

Matthew O. Jackson is the William D. Eberle Professor of Economics at Stanford University.
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Rating details

119 ratings
4.27 out of 5 stars
5 45% (53)
4 40% (48)
3 13% (16)
2 1% (1)
1 1% (1)
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