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Do Your Online Friends Make You Pay ? A Randomized Field Experiment in an Online Music Social Network
| Content Provider | Semantic Scholar |
|---|---|
| Author | Bapna, Ravi Umyarov, Akhmed |
| Copyright Year | 2012 |
| Abstract | Demonstrating compelling causal evidence of the existence and strength of peer to peer influence has become the holy grail of the modern research in online social networks. In these networks, it has been consistently demonstrated that user characteristics and behavior tend to cluster both in space and in time. There are two well known rival mechanisms that compete to be the explanation for this observed clustering: peer influence and homophily. Both mechanisms lead to similar observational data, yet have tremendously different policy implications. In this paper, we present a novel randomized experiment that tests the existence of causal peer influence in the general population of a particular large-scale online social network and quantifies its strength as compared to homophily. We utilize a unique social feature to exogenously induce adoption of a paid product amongst a group of randomly selected users, and in the process develop truly exogenous randomization of treatment and control groups. Our estimates show that peer influence causes 50% increase in odds of buying the product due to the influence coming from an adopting friend. In addition, we find that users with smaller number of friends are significantly more susceptible to be influenced by their peers as compared to the ones with larger number of friends. Finally, our experimental apparatus allows us to compare our randomized trial with a matching-based quasi-experiment. We find that the quasi-experiment tends to produce the results similar to randomized trial, but over-estimating the effect on users with larger number of friends and under-estimating it for the users with smaller number of friends, thus providing the first insights about the nature of bias in estimating peer-effects by the models with self-selected populations. |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://misrc.umn.edu/Papers/Research%20Papers/Bapna_Umyarov_LastFM.pdf |
| Alternate Webpage(s) | http://www.misrc.umn.edu/Papers/Research%20Papers/Bapna_Umyarov_LastFM.pdf |
| Alternate Webpage(s) | https://www.misrc.umn.edu/Papers/Research%20Papers/Bapna_Umyarov_LastFM.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
