www.econstor.eu Diversity and Popularity in Social Networks

Homophily, the tendency of linked agents to have similar characteristics, is an important feature of social networks. We present a new model of network formation that allows the linking process to depend on individuals types and study the impact of such a bias on the network structure. Our main results fall into three categories: (i) we compare the distributions of intraand inter-group links in terms of stochastic dominance, (ii) we show how, at the group level, homophily depends on the groups size and the details of the formation process, and (iii) we understand precisely the determinants of local homophily at the individual level. Especially, we find that popular individuals have more diverse networks. Our results are supported empirically in the AddHealth data looking at networks of social connections between boys and girls. JEL Codes : A14, D85, I21. *Bramoullé: Department of Economics, CIRPÉE and GREEN, Université Laval. Rogers: MEDS, Kellogg School of Management, Northwestern University. We thank Andrea Galeotti, Sanjeev Goyal, Matthew Jackson, Bruno Strulovici, and Adrien Vigier, as well as seminar participants at the First Transatlantic Theory Workshop (Paris), The University of Essex, and Cambridge University for helpful comments and conversations. This research uses data from Add Health, a program project designed by J. Richard Udry, Peter S. Bearman, and Kathleen Mullan Harris, and funded by a grant P01-HD31921 from the National Institute of Child Health and Human Development. Persons interested in obtaining data files from Add Health should contact Add Health, Carolina Population Center, 123 W. Franklin Street, Chapel Hill, NC 27516-2524 ([email protected]).