infonet-economy

We use variation in wind speeds at surfing locations in Switzerland as exogenous shifters of users' propensity to post content about their surfing activity onto an online social network. We exploit this variation to test whether users' social ties on the network have a causal effect on their content generation, and whether content generation in turn has a similar causal effect on the users' ability to form social ties. Economically significant causal effects of this kind can produce positive feedback that generate multiplier effects to interventions that subsidize tie formation. We argue these interventions can therefore be the basis of a strategy by the firm to indirectly facilitate content generation on the site. The exogenous variation provided by wind speeds enable us to measure this feedback empirically and to assess the return on investment from such policies. We use a detailed dataset from an online social network that comprises the complete details of social tie formation and content generation on the site. The richness of he data enable us to control for several spurious confounds that have typically plagued empirical analysis of social interactions. Our results show evidence for significant positive feedback in user generated content. We discuss the implications of the estimates for the management of the content and the growth of the network.