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Joint Econometrics & Applied Microeconomics Workshop: Xu Lin

Thursday, November 7, 2019 at 11:40am to 1:10pm

Uris Hall, 494
Central Campus

Xu Lin - Virginia Tech

Social Interactions and Social Preferences in Social Networks (joint w/Chih-Sheng Hsieh)

Abstract: We extend the utility speci cation in Ballester et al. (2006) to study social interactions when individuals hold altruistic preferences in social networks. We show that rich network features can be captured in the best response function derived by maximizing the extended utility which incorporates altruism, thereby providing microfoundation for studies on how network features mediate peer e ects or other important features in social interactions. We demonstrate that the often ignored altruism is another serious confounding factor of peer e ects. Our results show that the estimates of peer a ects are approximately 36% smaller under social preferences. Furthermore, we could separately identify two di erent types of e ects caused by peers' outcomes: the (usually positive) spillover e ects and the direct (negative or positive) externality e ects, which is impossible in a conventional social interactions model based on the self-interest hypothesis.

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Event Type

Class/ Workshop

Departments

Economics

Tags

EconSeminar, EconMetrics, economics, EconAppliedMicro

Contact E-Mail

uab1@cornell.edu

Contact Name

Ulrike Kroeller

Contact Phone

6072554254

Speaker

Xu Lin

Speaker Affiliation

Virginia Tech

Open To

Cornell Economics Community (List Serve Members)