Who you are or whom you know? Consumption interdependences in social networks

Daniel Birke*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


This paper presents an analysis of whether a consumer's decision to switch from one mobile phone provider to another is driven by individual consumer characteristics or by actions of other consumers in her social network. Such consumption interdependences are estimated using a unique dataset, which contains transaction data based on anonymized call records from a large European mobile phone carrier to approximate a consumer's social network. Results show that network effects have an important impact on consumers' switching decisions: switching decisions are interdependent between consumers who interact with each other and this interdependence increases in the closeness between two consumers as measured by the calling data. In other words, if a subscriber switches carriers, she is also affecting the switching probabilities of other individuals in her social circle. The paper argues that such an approach is of high relevance to both switching of providers and to the adoption of new products.

Original languageEnglish
Pages (from-to)281-299
Number of pages19
JournalEconomics of Innovation and new Technology
Issue number3
Publication statusE-pub ahead of print - 7 Nov 2012

Bibliographical note

Funding: University of Nottingham and the ESRC.


  • diffusion
  • mobile telecommunications
  • network effects
  • social networks
  • survival analysis


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