HOMOPHILY AND COMMUNITY STRUCTURE IN NETWORKS

This paper proposes a strategy to estimate the community structure for a network accounting for the empirically established fact that communities and links are formed based on homophily. It presents a maximum likelihood approach to rank community structures where the set of possible community structures depends on the set of salient characteristics and the probability of a link between two nodes varies according to the characteristics of the two nodes. This approach has good large sample properties, which lead to a practical algorithm for the estimation. To exemplify the approach it is applied to data collected from four village clusters in Ghana.