Migration and the Value of Social Networks

95 Pages Posted: 27 Mar 2019

See all articles by Joshua Evan Blumenstock

Joshua Evan Blumenstock

University of California, Berkeley

Guanghua Chi

University of California, Berkeley

Xu Tan

University of Washington

Date Written: March 2019

Abstract

What is the value of a social network? Prior work suggests two distinct mechanisms that have historically been difficult to differentiate: as a conduit of information, and as a source of social and economic support. We use a rich 'digital trace' dataset to link the migration decisions of millions of individuals to the topological structure of their social networks. We find that migrants systematically prefer 'interconnected' networks (where friends have common friends) to 'expansive' networks (where friends are well connected). A micro-founded model of network-based social capital helps explain this preference: migrants derive more utility from networks that are structured to facilitate social support than from networks that efficiently transmit information.

Keywords: Big Data, Development, migration, networks, social capital, Social Networks

JEL Classification: C55, D85, O12, O15, R23, Z13

Suggested Citation

Blumenstock, Joshua Evan and Chi, Guanghua and Tan, Xu, Migration and the Value of Social Networks (March 2019). CEPR Discussion Paper No. DP13611, Available at SSRN: https://ssrn.com/abstract=3360078

Joshua Evan Blumenstock (Contact Author)

University of California, Berkeley ( email )

102 South Hall
Berkeley, CA 94720-4600
United States

HOME PAGE: http://www.jblumenstock.com

Guanghua Chi

University of California, Berkeley ( email )

310 Barrows Hall
Berkeley, CA 94720
United States

Xu Tan

University of Washington ( email )

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
1
Abstract Views
2,051
PlumX Metrics