Testing Unilateral and Bilateral Link Formation

23 Pages Posted: 2 Sep 2014

See all articles by Margherita Comola

Margherita Comola

Paris School of Economics (PSE); Université Paris I Panthéon-Sorbonne

Marcel Fafchamps

Stanford University - Freeman Spogli Institute for International Studies

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Date Written: September 2014

Abstract

Empirical analysis of social networks is often based on self‐reported links from survey data. How we interpret such data is crucial for drawing correct inference on network effects. We propose a method for testing whether survey responses can safely be interpreted as a link and, if so, whether links are generated by a unilateral or bilateral link formation process. We present two empirical illustrations of the test on risk‐sharing links in Tanzania and on communication among Indian farmers, respectively, demonstrating the ability of the methodology to discriminate between competing data‐generating processes.

Suggested Citation

Comola, Margherita and Fafchamps, Marcel, Testing Unilateral and Bilateral Link Formation (September 2014). The Economic Journal, Vol. 124, Issue 579, pp. 954-976, 2014, Available at SSRN: https://ssrn.com/abstract=2490184 or http://dx.doi.org/10.1111/ecoj.12071

Margherita Comola (Contact Author)

Paris School of Economics (PSE) ( email )

48 Boulevard Jourdan
Paris, 75014 75014
France

Université Paris I Panthéon-Sorbonne ( email )

17, rue de la Sorbonne
Paris, IL 75005
France

Marcel Fafchamps

Stanford University - Freeman Spogli Institute for International Studies ( email )

Stanford, CA 94305
United States

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