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- Title
Local Network Interaction as a Mechanism for Wealth Inequality.
- Authors
Yu, Shao-Tzu; Wang, Peng; Kabudula, Chodziwadziwa W.; Gareta, Dickman; Harling, Guy; Houle, Brian
- Abstract
Given limited institutional resources, low-income populations often rely on social networks to improve their socioeconomic outcomes. However, it remains in question whether small-scale social interactions could affect large-scale economic inequalities in under-resourced contexts. Here, we leverage population-level data from one of the poorest South African settings to construct a large-scale, geographically defined, inter-household social network. Using a multilevel network model, we show that having social ties in close geographic proximity is associated with stable household asset conditions, while geographically distant ties correlate to changes in asset allocation. Notably, we find that localised network interactions are associated with an increase in wealth inequality at the regional level, demonstrating how macro-level inequality may arise from micro-level social processes. Our findings highlight the importance of understanding complex social connections underpinning inter-household resource dynamics, and raise the potential of large-scale social assistance programs to reduce disparities in resource-ownership by accounting for local social constraints. Yu and colleagues leverage population-level data to construct a large-scale, geographically defined, inter-household social network. Using a multilevel network model, they show that having social ties in close geographic proximity is associated with stable household asset conditions, while geographically distant ties correlate to changes in asset allocation. Notably, they find that localised network interactions are associated with an increase in wealth inequality at the regional level, demonstrating how macro-level inequality may arise from micro-level social processes.
- Subjects
WEALTH inequality; SOCIAL processes; ASSET allocation; REGIONAL disparities; INCOME inequality
- Publication
Nature Communications, 2024, Vol 15, Issue 1, p1
- ISSN
2041-1723
- Publication type
Article
- DOI
10.1038/s41467-024-49607-0