Explaining Clustering in Social Networks: Towards an Evolutionary Theory of Cascading Benefits

Publication Type

Journal Article

Publication Date

2006

Abstract

Individual and organizational actors enter into a large number of relationships that include benefiting others without ensuring the equality of reciprocal benefits. We suggest that actors have evolved mechanisms that guide them in the choice of exchange partners, even without conscious calculation or bookkeeping of gain and loss. One such mechanism directs actors to membership in clusters, which are homogenous groups of actors densely connected among themselves and only loosely connected to other groups. We suggest that clusters offer network externalities, which are not possible in sparse networks, thus conferring cascading benefits on the actors contained in those clusters. Using this logic, one can understand the omnipresence of clustering in social networks of individuals and firms. We review the benefits and challenges associated with clustering and use the logic of cascading benefits to derive empirical predictions.

Discipline

Human Resources Management

Research Areas

Organisational Behaviour and Human Resources

Publication

Managerial and Decision Economics

Volume

27

Issue

2-3

First Page

173

Last Page

187

ISSN

0143-6570

Identifier

10.1002/mde.1291

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