Testing for Differences in Stochastic Network Structure

DOI10.3982/ECTA18093MaRDI QIDQ6044987zbMATH OpenFDO

Authors Eric Auerbach

Publication date 26 May 2023

Published in Econometrica (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/1903.11117

zbMATH Keywords

panel datarandomization inferencenetworksheterogeneous treatment effectssemidefinite programmingnetwork externalitiesmatrix normsendogenous link formation

Mathematics Subject Classification ID

Semidefinite programming (90C22) Mathematical economics (91B99) Stochastic models in economics (91B70)

Abstract: How can one determine whether a community-level treatment, such as the introduction of a social program or trade shock, alters agents' incentives to form links in a network? This paper proposes analogues of a two-sample Kolmogorov-Smirnov test, widely used in the literature to test the null hypothesis of "no treatment effects", for network data. It first specifies a testing problem in which the null hypothesis is that two networks are drawn from the same random graph model. It then describes two randomization tests based on the magnitude of the difference between the networks' adjacency matrices as measured by the $2o2$ and $inftyo1$ operator norms. Power properties of the tests are examined analytically, in simulation, and through two real-world applications. A key finding is that the test based on the $inftyo1$ norm can be substantially more powerful than that based on the $2o2$ norm for the kinds of sparse and degree-heterogeneous networks common in economics.

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Cited in

(5)

• A note on testing conditional independence for social network analysis
• A jackknife bias correction for nonlinear network data models with fixed effects
• Multiple conditional randomization tests for lagged and spillover treatment effects
• Exact tests for singular network data
• Testing and Estimation of Social Network Dependence With Time to Event Data

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