Computational Economics: Heterogeneous Agent Modeling

Chapter 12

Heterogeneity and Networks^✶

Sanjeev Goyal    Faculty of Economics and Christ's College, University of Cambridge, Cambridge, United Kingdom, [e-mail]

Abstract

This chapter shows that networks can have large and differentiated effects on behavior and then argues that social and economic pressures facilitate the formation of heterogeneous networks. Thus networks can play an important role in understanding the wide diversity in human behavior and in economic outcomes.

Keywords

Networks; Network formation; Heterogeneity; Linking; Intermediation; Structural holes

1 Introduction and Overview

Social, economic and infrastructure networks are an important feature of an economy. Empirical research has highlighted the presence ...