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Title: Homophily and Search

Citation Type: Miscellaneous

Publication Year: 2010

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Abstract: We study the formation of social ties among heteogeneous agents in a model where who meets who is determined through a random search process. Our aim is to understand how theincentives to connect with similar agents vary across social groups, and what role is played by groups' sizes. The key element of our approach is that search is more e effective when exerted in large pools. We show that search equilibrium is characterized by a threshold in terms ofgroup size, so that larger groups only search among similar agents, while smaller groups search among the whole population. Under the assumption that search is subject to small frictions, this type of equilibrium behaviour is shown to generate patterns of homophily which are consistentwith empirical evidence from diverse social environments, such as high school friendships and interethnic marriages. In particular, homophily is largest in medium sized groups, while very small and very large groups are characterized by a mix of social connections that approximates their population shares.

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Authors: Currarini, Sergio; Vega Redondo, Fernando

Publisher: Universita di Venezia

Data Collections: IPUMS USA

Topics: Other

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