Network effects and social inequality

Paul Dimaggio, Filiz Garip

    Research output: Contribution to journalReview articlepeer-review

    Abstract

    Students of social inequality have noted the presence of mechanisms militating toward cumulative advantage and increasing inequality. Social scientists have established that individuals' choices are influenced by those of their network peers in many social domains. We suggest that the ubiquity of network effects and tendencies toward cumulative advantage are related. Inequality is exacerbated when effects of individual differences are multiplied by social networks: when persons must decide whether to adopt beneficial practices; when network externalities, social learning, or normative pressures influence adoption decisions; and when networks are homophilous with respect to individual characteristics that predict such decisions. We review evidence from literatures on network effects on technology, labor markets, education, demography, and health; identify several mechanisms through which networks may generate higher levels of inequality than one would expect based on differences in initial endowments alone; consider cases in which network effects may ameliorate inequality; and describe research priorities.

    Original languageEnglish (US)
    Pages (from-to)93-118
    Number of pages26
    JournalAnnual Review of Sociology
    Volume38
    DOIs
    StatePublished - Aug 2012

    Keywords

    • Cumulative advantage
    • Diffusion
    • Externalities
    • Homophily
    • Spillovers
    • Threshold models

    ASJC Scopus subject areas

    • Sociology and Political Science

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