Connections matter: a proxy measure for evaluating network membership with an application to the Seventh Research Framework Programme

Abstract

Although the topic of networks has received significant attention from the scientific literature, it remains to be seen whether it is possible to quantify the degree to which an organisation benefits from being part of a network. Starting from the concept of network value and that of Metcalfe’s Law, this paper introduces and defines the collective network effect (CNE). CNE is based on the concept that a network member is not only affected by its friends but also by the friends of its friends. By taking into account network connection patterns, CNE provides a proxy for quantifying the benefit of network membership. We computed the CNE for the nodes of a large network built using the whole set of common projects among the participants of the 7th Framework Programme for Research and Technological Development of the European Commission. The obtained results show that nodes with a higher CNE have access to substantially more conspicuous fundings than nodes with a lower CNE. In general, such a measure could supplement other centrality measures and be useful for organisations and companies aiming to evaluate both their current situation and the potential partners they should link with in order to extract the highest benefits from network membership.