Homophily and long-run integration in social networks

We model network formation when heterogeneous nodes enter sequentially and form connections through both random meetings and network-based search, but with type-dependent biases. We show that there is “long-run integration,” whereby the composition of types in sufficiently old nodes’ neighborhoods approaches the global type distribution, provided that the network-based search is unbiased. However, younger nodes’ connections still reflect the biased meetings process. We derive the type-based degree distributions and group-level homophily patterns when there are two types and location-based biases. Finally, we illustrate aspects of the model with an empirical application to data on citations in physics journals. JEL Codes: D85, A14, Z13.