Homophily and Social Network Engagement: Evidence From a Video Gaming Platform

32 Pages Posted: 5 May 2018

See all articles by Michael R. Ward

Michael R. Ward

University of Texas at Arlington - College of Business Administration - Department of Economics; ZEW, Mannheim

Date Written: April 19, 2018

Abstract

I estimate how increased similarity with one’s friends in a social network member leads one to engage further with the social network. Participation is modeled based on user utility derived both from participating in events close to their preferred “location” and from their friends’ simultaneous participation in the event. This suggests that, even after controlling for network structure, focal users will participate more as their friends’ preferences move closer to their own. These implications are tested using panel data from an online video gaming network. Homophily is measured by similarity in recent past video game playing choices. Because the data track users over time, I am able to test effects from deviations in similarity measures from week to week. Decomposing similarity measures based on whether the focal user’s, or her friends’, preferences are changing which helps to identify causal effects. The evidence supports a large increase in engagement from increased homophily. Platform managers can profitably incorporate these effects into their CRM systems.

Keywords: Homophily, Engagement, Video Games

JEL Classification: D85, M31, L96

Suggested Citation

Ward, Michael Robert, Homophily and Social Network Engagement: Evidence From a Video Gaming Platform (April 19, 2018). Available at SSRN: https://ssrn.com/abstract=3165823 or http://dx.doi.org/10.2139/ssrn.3165823

Michael Robert Ward (Contact Author)

University of Texas at Arlington - College of Business Administration - Department of Economics ( email )

330 Business Building
Box 19479
Arlington, TX 76019
United States
817-272-3090 (Phone)
817-272-3145 (Fax)

ZEW, Mannheim ( email )

D-68034 Mannheim
Germany

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