Moving beyond stylized economic network models: The hybrid world of the Indian firm ownership network

Abstract

A central theme of economic sociology has been to highlight the complexity and diversity of real world markets, but many network models of economic social structure ignore this feature and rely instead on stylized one-dimensional characterizations. Here, the authors return to the basic insight of structural diversity in economic sociology. Using the Indian interorganizational ownership network as their case, they discover a composite—or “hybrid”—model of economic networks that combines elements of prior stylized models. The network contains a disconnected periphery conforming closely to a “transactional” model; a semiperiphery characterized by small, dense clusters with sporadic links, as predicted in “small world” models; and finally a nested core composed of clusters connected via multiple independent paths. The authors then show how a firm’s position within the mesolevel structure is associated with demographic features such as age and industry and differences in the extent to which firms engage in multiplex and high-value exchanges.