Homophily, the tendency of linked agents to have similar characteristics, is an important feature of social networks. We present a new model of network formation that allows the linking process to depend on individuals types and study the impact of such a bias on the network structure. Our main...

of cooperating and defecting agents at equilibrium.

We analyze friendship formation patterns and develop a dynamic model of friendship formation that combines choices with random meeting patterns. We estimate biases in agents' preferences over the races of their friends and biases in the rates at which agents of various races meet each other. We...