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How Homophily Affects Learning and Diffusion in Networks AgEcon
Golub, Benjamin; Jackson, Matthew O..
We examine how three different communication processes operating through social networks are affected by homophily - the tendency of individuals to associate with others similar to themselves. Homophily has no effect if messages are broadcast or sent via shortest paths; only connection density matters. In contrast, homophily substantially slows learning based on repeated averaging of neighbors' information and Markovian diffusion processes such as the Google random surfer model. Indeed, the latter processes are strongly affected by homophily but completely independent of connection density, provided this density exceeds a low threshold. We obtain these results by establishing new results on the spectra of large random graphs and relating the spectra to...
Tipo: Working or Discussion Paper Palavras-chave: Networks; Learning; Diffusion; Homophily; Friendships; Social Networks; Random Graphs; Mixing Time; Convergence; Speed of Learning; Speed of Convergence; Institutional and Behavioral Economics; D83; D85; I21; J15; Z13.
Ano: 2009 URL: http://purl.umn.edu/50718
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Marketing via Friends: Strategic Diffusion of Information in Social Networks with Homophily AgEcon
Chuhay, Roman.
The paper studies the impact of homophily on the optimal strategies of a monopolist, whose marketing campaign of new product relies on a word of mouth communication. Homophily is a tendency of people to interact more with those who are similar to them. In the model there are two types of consumers embedded into a social network, which differ in friendship preferences and desirable design of product. Consumers can learn about the product directly from an advertisement or from their neighbors. The monopolist chooses the product design and price to influence a pattern of communication among consumers. We find a number of results: (i) for low levels of homophily the product attractive to both types of consumers is preferred to specialized products; (ii) the...
Tipo: Working or Discussion Paper Palavras-chave: Networks; Word of Mouth; Viral Marketing; Homophily; Diffusion; Social Networks; Random Graphs; Monopoly; Pricing Strategy; Product Design; Marketing; Advertisement; Environmental Economics and Policy; D21; D42; D60; D83; L11; L12.
Ano: 2010 URL: http://purl.umn.edu/96667
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