Networks: An Economic Perspective

43 Pages Posted: 30 Aug 2016

See all articles by Matthew O. Jackson

Matthew O. Jackson

Stanford University - Department of Economics; Santa Fe Institute

Brian Rogers

Washington University in St. Louis

Yves Zenou

Stockholm University; Monash University - Department of Economics; Research Institute of Industrial Economics (IUI); IZA Institute of Labor Economics; Centre for Economic Policy Research (CEPR)

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Date Written: August 2016


We discuss social network analysis from the perspective of economics. We organize the presentation around the theme of externalities: the effects that one's behavior has on others' welfare. Externalities underlie the interdependencies that make networks interesting to social scientists. We discuss network formation, as well as interactions between peoples' behaviors within a given network, and the implications in a variety of settings. Finally, we highlight some empirical challenges inherent in the statistical analysis of network-based data.

Keywords: economic networks, externalities, Game theory, network formation, network games, Networks, peer effects, Social Networks

JEL Classification: C72, D85, L14, Z13

Suggested Citation

Jackson, Matthew O. and Rogers, Brian and Zenou, Yves and Zenou, Yves, Networks: An Economic Perspective (August 2016). CEPR Discussion Paper No. DP11452, Available at SSRN:

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
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Brian Rogers

Washington University in St. Louis ( email )

One Brookings Drive
Campus Box 1208
Saint Louis, MO MO 63130-4899
United States

Yves Zenou

Monash University - Department of Economics ( email )


Stockholm University ( email )

Universitetsvägen 10
Stockholm, Stockholm SE-106 91

Research Institute of Industrial Economics (IUI) ( email )

P.O. Box 5501
S-114 85 Stockholm

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072

Centre for Economic Policy Research (CEPR)

United Kingdom

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