Abstract
Social network research has begun to take advantage of fine-grained communications regarding coordination, decision-making, and knowledge sharing. These studies, however, have not generally analyzed how external events are associated with a social network's structure and communicative properties. Here, we study how external events are associated with a network's change in structure and communications. Analyzing a complete dataset of millions of instant messages among the decision-makers with different roles in a large hedge fund and their network of outside contacts, we investigate the link between price shocks, network structure, and change in the affect and cognition of decision-makers embedded in the network. We also analyze the communication dynamics among specialized teams in the organization. When price shocks occur the communication network tends not to display structural changes associated with adaptiveness such as the activation of weak ties to obtain novel information. Rather, the network “turtles up.” It displays a propensity for higher clustering, strong tie interaction, and an intensification of insider vs. outsider and within-role vs. between-role communication. Further, we find changes in network structure predict shifts in cognitive and affective processes, execution of new transactions, and local optimality of transactions better than prices, revealing the important predictive relationship between network structure and collective behavior within a social network.
| Original language | English (US) |
|---|---|
| Article number | 6 |
| Journal | ACM Transactions on the Web |
| Volume | 13 |
| Issue number | 1 |
| DOIs | |
| State | Published - Feb 2019 |
Funding
This research was sponsored by the Northwestern University Institute on Complex Systems (NICO), the U. S. Army Research Laboratory and the U. S. Army Research Office under grant number W911NF-09-2-0053, Defense Advanced Research Projects Agency grant BAA-11-64, a Simons Investigator Award, a Google Research Grant, a Facebook Faculty Research Grant, an ARO MURI grant \u201CQUANTA: Quantitative Network-based Models of Adaptive Team Behavior\u201D, and NSF grants IIS-0910664 and IIS-1617820. The views and conclusions contained in this document are those of the authors and should not be interpreted as representing the official policies, either expressed or implied, of the Army Research Laboratory or the U.S. government. All our summary statistics and programs are available on request. Northwestern University IRB Approved the Study (#STU00200578). All data were previously collected, accessed from the firm\u2019s archive, anonymized, and involved no manipulation or interaction with subjects. Subjects knew the data were collected and available for research purposes. The firm provided the data under written agreement for research purposes contingent on firm\u2019s identifying characteristics remaining confidential and anonymous. This article is an extension of a article published in the Proceedings of the 25th ACM International World Wide Web Conference (Romero et al. 2016). This extended version of the article includes a new analysis and set of results on the communication dynamics among employees of the hedge fund with different titles and roles: portfolio managers, traders, and analysts. Our results show that the daily distribution of active IM users by role changes significantly with stock price changes, exhibiting more active analysis and less active traders. This is consistent with the firm spending more effort planning and analyzing their decision making than executing their decisions when price shocks occur. Additionally, we observe new evidence that is consistent with the firm \u201Cturtling up\u201D\u2014when price shocks occur, there is an increased volume of communication among employees of the same role. These new findings provide a more detailed view of the social dynamics in the organization during times of stress by taking into account the roles of the employees of the firm and their inter-and intra-group communication. Authors\u2019 addresses: D. M Romero, 3340 North Quad, 105 S. State Street, University of Michigan, Ann Arbor, MI 48109; email: [email protected]; B. Uzzi, 2211 Campus Drive, Room 5329, Northwestern University, Evanston, IL 60208; email: [email protected]; J. Kleinberg, Computing and Information Science, Gates Hall, Cornell University, Ithaca, NY 14853; email: [email protected]. Permission to make digital or hard copies of all or part of this work for personal or classroom use is granted without fee provided that copies are not made or distributed for profit or commercial advantage and that copies bear this notice and the full citation on the first page. Copyrights for components of this work owned by others than ACM must be honored. Abstracting with credit is permitted. To copy otherwise, or republish, to post on servers or to redistribute to lists, requires prior specific permission and/or a fee. Request permissions from [email protected]. \u00A9 2019 Association for Computing Machinery. 1559-1131/2019/02-ART6 $15.00 https://doi.org/10.1145/3295460 This research was sponsored by the Northwestern University Institute on Complex Systems (NICO), the U. S. Army Research Laboratory and the U. S. Army Research Office under grant number W911NF-09-2-0053, Defense Advanced Research Projects Agency grant BAA-11-64, a Simons Investigator Award, a Google Research Grant, a Facebook Faculty Research Grant, an ARO MURI grant \u201CQUANTA: Quantitative Network-based Models of Adaptive Team Behavior\u201D, and NSF grants IIS-0910664 and IIS-1617820. The views and conclusions contained in this document are those of the authors and should not be interpreted as representing the official policies, either expressed or implied, of the Army Research Laboratory or the U.S. government. All our summary statistics and programs are available on request. Northwestern University IRB Approved the Study (#STU00200578).
Keywords
- Collective behavior
- Organizations
- Social networks
- Temporal dynamics
ASJC Scopus subject areas
- Computer Networks and Communications