Social Structure, Segregation, and Economic Behavior

19 Pages Posted: 13 Aug 2010

See all articles by Matthew O. Jackson

Matthew O. Jackson

Stanford University - Department of Economics; Santa Fe Institute; Canadian Institute for Advanced Research (CIFAR)

Date Written: February 5, 2009


I discuss a fundamental and pervasive aspect of social networks that has a signfii…cant impact on behavior: "homophily. "Homophily refers to the tendency of individuals to associate with others who have similar characteristics as themselves. This tendency has been observed across a variety of dimensions including ethnicity, age, gender, profession, and education level, among others. Given that our opinions, behaviors, and decisions are infl‡uenced by those we are in contact with, having a thorough grasp of homophily and how it shapes our social networks and ultimately translates into our behaviors becomes imperative.

This lecture proceeds in three parts. It begins with background on homophily, providing some illustrations and a very brief look at some empirical studies on homophily. It then proceeds to the impact of homophily, discussing the effects of homophily on three different things: how information diffuses through a society, how individuals make education decisions, and social mobility. After discussing the impact of homophily on these different behaviors, I conclude with a discussion of a model of homophily and what we might learn about what leads to homophily.

Keywords: homophily, diffusion, social mobility, segregation, networks, social networks

JEL Classification: D85, C72, L14, Z13, J15, J71

Suggested Citation

Jackson, Matthew O., Social Structure, Segregation, and Economic Behavior (February 5, 2009). Available at SSRN: or

Matthew O. Jackson (Contact Author)

Stanford University - Department of Economics ( email )

Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States
1-650-723-3544 (Phone)


Santa Fe Institute

1399 Hyde Park Road
Santa Fe, NM 87501
United States

Canadian Institute for Advanced Research (CIFAR) ( email )

180 Dundas Street West, Suite 1400
Toronto, Ontario

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