Social Network Positions, Peer Effects, and Evaluation Updating: An Experimental Test in the Entrepreneurial Context

Abstract

In many facets of life, individuals make evaluations that they may update after consulting with others in their networks. But not all individuals have the same positional opportunities for social interaction in a given network or the ability and desire to make use of those opportunities that are available to them. The configuration of a person’s network can also alter how information is spread or interpreted. To complicate matters further, scant research has considered how positions in social networks and the valence of network content interact because of the difficulty of (a) separating the “player” from the position in networks and (b) measuring all germane content in a particular network. This research develops a novel experimental platform that addresses these issues. Participants viewed and evaluated an entrepreneurial video pitch and were then randomly assigned to different networks, and positions within networks, and thus various opportunities for peer influence that were orthogonal to their network history, inclinations, attributes, or capabilities. Furthermore, all the content of social interaction, including its valence, was recorded to test underlying assumptions. Results reveal that those assigned to a position with brokerage opportunities in a network updated their evaluations of the entrepreneurial video considerably more negatively.