Network Analysis for Economics and Management Studies

In this chapter it is underlined that, though economics has systematically adopted network analysis much later than sociology, the development of network economics during last 15 years has been massive, alongside three main research streams: strategic formation network modeling, (mostly descriptive) analysis of real economic networks, and optimization methods of economic networks. It is argued that the main reason for that delay is that the most essential network properties, like externalities, endogenous change processes, and nonlinear propagation processes, definitely prevent the possibility to build a general competitive equilibrium theory. For this paradigm has dominated economics in the last century, this incompatibility operated as a hard brake and made network analysis an inappropriate epistemology for mainstream economics. Further, being intrinsically structuralist, social network analysis was also antithetic to radical methodological individualism, which was economics dominant methodology. Conversely, though culturally and scientifically influenced by economists in some fields, management scholars were free from “neoclassical economics chains”, and therefore more ready and open to adopt the methodology and epistemology of social network analysis. Mostly descriptive until 15 years ago, some methods of investigation through statistical network modeling offer the possibility to develop network formation and network dynamics models, which stay between the much more powerful agent-based simulation models and the usually descriptive methods