Social networks: Effects and formation

Social networks affect individual behavior as well as social phenomena resulting from behavior ('effects'). Also, when actors can choose with whom to interact, social networks themselves are shaped by behavior ('formation'). This chapter provides a selective overview of rigorous sociology on effects of social networks and their formation. We discuss two examples ('case studies'). One is on effects of exogenously given network characteristics, the other on endogenous network formation. Our examples highlight how micro-macro models account for effects and formation of social networks.