Matching and Network Effects

45 Pages Posted: 19 Dec 2006

See all articles by Marcel Fafchamps

Marcel Fafchamps

Stanford University - Freeman Spogli Institute for International Studies

Sanjeev Goyal

University of Cambridge

Marco van der Leij

CeNDEF, University of Amsterdam; Congregation of the Blessed Sacrament - European Novitiate

Date Written: October 25, 2006

Abstract

Individuals form teams to produce an output. The quality and quantity of a team's output depends on the ability and the effort level of its members. The ability of individuals as well as their work ethic is however imperfectly known. In such an environment, individuals wishing to form a new team can get information about each other from the network of past collaborators. The paper carries out an empirical examination of the existence and magnitude of this network effect.

This empirical work looks at the formation of coauthor relations among economists over a twenty year period. Our principal finding is that a new collaboration emerges faster among two researchers if they are 'closer' in the existing coauthor network among economists. This proximity effect on collaboration is strong: being at a network distance of 2 instead of 3, for instance, raises the probability of initiating a collaboration by 29 percent. However, proximity has no effect on subsequent collaboration among the two individuals. Thus the coauthor network acts as a 'referral' mechanism among economists.

Keywords: Networks, Social interaction, Matching, Collaboration, Economics

JEL Classification: A14, C33, C41, D82, D83, O31, Z13

Suggested Citation

Fafchamps, Marcel and Goyal, Sanjeev and van der Leij, Marco Juri, Matching and Network Effects (October 25, 2006). Available at SSRN: https://ssrn.com/abstract=952448 or http://dx.doi.org/10.2139/ssrn.952448

Marcel Fafchamps (Contact Author)

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

Stanford, CA 94305
United States

Sanjeev Goyal

University of Cambridge ( email )

Trinity Ln
Cambridge, CB2 1TN
United Kingdom

Marco Juri van der Leij

CeNDEF, University of Amsterdam ( email )

Roetersstraat 11
Amsterdam, NL-1018WB
Netherlands

HOME PAGE: http://home.staff.uva.nl/m.j.vanderleij

Congregation of the Blessed Sacrament - European Novitiate ( email )

Waversesteenweg 201
Brussels, 1050
Belgium

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