|Abstract:||Homophily, or the fact that similar individuals tend to interact with each other, is a prominent feature of economic and social networks. I show that the equilibrium structure of homophily has empirical power. I build a strategic model of network formation, which produces a unique equilibrium network. Individuals have homophilic preferences and face capacity constraints on the number of links. I develop a novel empirical method, based on the shape of the equilibrium network, which allows for the identi cation and estimation of the underlying homophilic preferences. I apply this new methodology to the formation of friendship networks.|
|Document Type:||Article de recherche|
|Issue Date:||23 January 2015|
|Open Access Date:||6 April 2018|
|This document was published in:||International Economic Review, Vol. 56 (1), 235–264 (2015)|
Philadelphia Economics Dept. of the University of Pennsylvania
|Collection:||Articles publiés dans des revues avec comité de lecture|
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