Center for Network Science Hosts “Circuits of Profit: Business Network Research Conference”

On January 28, CEU’s Center for Network Science (CNS), together with Maven 7 and the Hungarian Sociological Association, hosted “Circuits of Profit: Business Network Research Conference”, a one-day conference which brought together leading academics and practitioners from the burgeoning field of network science for discussions on issues ranging from organizational restructuring and political lobbying and corruption, to marketing, and finance.

CNS Director Balazs Vedres welcomed the audience to the event, after which CEU President and Rector John Shattuck provided opening remarks and an introduction to the keynote speaker and prominent network researcher, Albert-László Barabási.

In his address, Barabási gave a broad overview on the types of situations in which networks develop in society, including the Internet, banking systems, trade patterns, and airline flight scheduling, to name a few. He explained how networks, comprised of nodes and links, assemble over time. Theoretically these assemblies should appear randomly, however because real networks are always expanding, rather than staying in a constant position -- new nodes tend to connect to highly-connected nodes -- biased toward the connections it already has. The rate at which a node gains its connections is not necessarily amplified by being a ‘first-mover’ – in fact a more important variable is one called fitness, or, the quality of the node. A node with enough fitness and incoming links, can be further labeled as a ‘super hub’. If this type of hub emerges, it is possible that it maintains its market share of links, even if the overall market expands considerably. Barabási gave the example of Microsoft in the 1990s to illustrate this point.

Barabási’s final point was to show how these network assembly tendencies can be extrapolated to explain patterns in a variety of different real life circumstances. In global trade, for example, he noted how certain types of manufacturing capabilities were related to one another – and that exporters of items such as computers, and cars, tend to clump together with one another; as do exporters of goods such as fruit, and textiles. The fact that this gap can be difficult to bridge, is borne out when network simulations are run forward in time, and less developed countries such as in Africa are shown to be hopelessly far behind. These simulations can thus have meaningful ramifications for international business, relations, and policy.

Following Barabási’s address, a series of panel discussions took place on topics such as organizational development, social media, politics and business, and finance.

Network science, as a maturing field, offers a unique perspective to tackle complex problems, impenetrable to our conventional, linear-proportional thinking. Witnessing a decade of explosive growth, researchers in this field unveiled principles of networked behavior in a wide range of fields, from the evolution of the Internet, to networks of friendship, disease transmission, ecological interactions and economic transactions. The economy is a vast and complex system of links, where network approaches can become powerful tools for competitive advantage.