Social relations are crucial for understanding diverse economic actions and a network perspective is central to that explanation. Simple exchanges involving money, labor, and commodities combine into complexly connected systems. Economic networks span many levels of analysis, from persons (consumers, employees), to groups (households, workteams), organizations (corporations, interest groups), populations (industries, markets) and the rapidly expanding global economic system.

David Knoke blends network theories from a range of disciplines and empirical studies of domestic and international economies to illuminate how economic activity is embedded in and constrained by social ties among economic actors. Social capital, in the form of connections to others holding valuable resources, is vital for finding a job, buying a car, creating a new industry, or triggering a global financial crisis. In nontechnical terms the author explicates the core network concepts, measures, and analysis methods behind these phenomena. The book also includes many striking network diagrams to provide visual insights into complex structural patterns.

This accessible book offers an invaluable critique for both undergraduate and graduate students in economic sociology and social network analysis courses who seek a better understanding of the multifaceted economic webs in which we are all entangled.

List of Figures ix

Preface xi

1 Economics and Social Networks 1

Mainstream and Alternative Economic Theories 3

The Economic Sociology Perspective 13

The Social Network Perspective 21

Summary and Outline of the Book 24

2 Markets and Networks 25

Labor Markets 28

Consumer Markets 41

Producer Markets 56

Summary 64

3 Networks inside Organizations 66

Micro-Network Concepts 69

Social Capital 75

Forming Employee Networks 81

Network Outcomes 90

Team Networking 105

Summary 110

4 Networks among Organizations 111

Business Startup Networks 112

Business Groups 118

Interlocking Directorates 128

Strategic Alliances 131

Evolution of Interorganizational Networks 146

Summary 155

5 Global Networks 157

International Networks 158

Supply and Commodity Chains 163

World Cities Networks 165

A Transnational Capitalist Class? 171

Networks of the Global Financial Crisis 177

Summary 186

6 Looking Forward 187

Theory Construction 188

Empirical Tools 191

Connecting Economy and Polity 193

Appendix: Network Resources 197

References 200

Index 232