Digging the Structural Hole: Brokering’s Impact on Network Structure

Abstract

Whereas the traditional view of brokerage implies solidified social ties activated by brokers, an alternative view acknowledges the potential for brokers to alter network structure. However, even researchers who hold this view analyze the role of brokers’ properties, whereas how their behavior shapes network structure remains largely unexamined. Using ethnographic observations at a family office that brokers between wealthy clients and professionals, this study develops a grounded theory of how brokering behavior alters network structure. It finds that faced with uncertain brokerage opportunities and contingent social ties, brokers can make strong claims about the quality of their network ties even before they are established. Motivated by potential rewards, they first actively test opportunities for brokerage using tactics like invoking external threats. Then, in addition to activating existing network ties, they also change network structure to pursue discrete brokerage opportunities. Taken together, these findings bolster our understanding of how broker agency and network structure are mutually constitutive in practice. They show that in addition to who brokers are, what brokers do can also shape network structure.