Network Evolution: The Origins of Structural Holes

We develop and test a theory of the origins of network structures, specifically of structural holes, building and testing a theoretical framework proposing that network structures emerge from the interplay of two complementary forces: structural constraints and network opportunities. We analyze data on a co-membership network among 501 production teams in the Italian TV production industry tracked over a period of 12 years, explicitly accounting for endogeneity. We find that structural holes spanned by teams originate from the prior status and centrality of teams that members were part of in the past, in addition to structural holes spanned in the past. But a focal team spans fewer structural holes if its members were part of cohesive teams earlier and if the past teams they were connected to produced similar artistic content. We also demonstrate that spanning structural holes is associated with superior team performance in terms of greater viewership. The results support both opportunity exploitation and structural constraint explanations, although we find that homogeneity rather than diversity influences performance across structural holes.