FEEM working papers "Note di lavoro" series
2014 .049

Individual Search and Social Networks

Authors: Sanjeev Goyal, Stephanie Rosenkranz, Utz Weitzel, Vincent Buskens
Series: Climate Change and Sustainable Development
Editor: Carlo Carraro
Keywords: Social networks
JEL n.: D83, D85


The explosion in online social networks motivates an enquiry into their structure and their welfare effects. A central feature of these networks is information sharing: online social networks lower the cost of getting information from others. These lower costs affect the attractiveness of individual search vis-a-vis a reliance on social networks. The paper reports the findings of an experiment on these effects. Our experiment shows that online networks can have large effects. Information acquisition is more dispersed and it is accompanied by denser social networks. Aggregate investment in information acquisition falls, but information available to individuals remains stable, due to increased networking. The overall effect is a significant increase in individual utility and aggregate welfare.


Suggested citation: Goyal, S., S. Rosenkranz, U. Weitzel, V. Buskens, (2014), 'Individual Search and Social Networks' Nota di Lavoro 49.2014, Milan, Italy: Fondazione Eni Enrico Mattei.

Download file
Download PDF file

FEEM Newsletter & Update

Subscribe to stay connected.

Your personal data will be processed by Fondazione Eni Enrico Mattei. – data Controller – with the aim of emailing the FEEM newsletter & Update. The use of Your email address is necessary for the implementation of the newsletter service. You are invited to read the Privacy Policy in order to obtain additional information about the protection of Your rights.

This Website uses technical cookies and cookie analytics, as well as “third party” profiling cookies.
If you close this banner or you decide to continue navigating on this Website, you express consent to the use of cookies. If you need additional information or you wish to express selective choices on the use of cookies, please refer to the   Cookie PolicyI agree