Close communication and 2-clubs in corporate networks: Europe 2010

Abstract

Corporate networks, as induced by interlocking directorates between corporations, provide structures of personal communication between their boards. This paper studies such networks using the framework of a previous paper by Laan et al. (Soc Netw Anal Min, 2016. doi:10. 1007/s13278-016-0326-0) where close communication is defined by sub-networks, so that each pair of nodes (boards of a corporation) are either neighbours or have at least one common neighbour. These correspond to sub-graphs of diameter at most 2, designated by us earlier as 2-clubs of three types (coteries, social circles and hamlets), and conform three levels of close communication in social networks. They are all contained within the disjoint boroughs of a network, supercommunities which envelope all close communication between nodes of a network. This framework is applied here to an analysis of corporate board interlocks between the top 300 European corporations 2010, using the data from an earlier study by one of us (Heemskerk in Econ Soc 42:74-101, 2013). While the results corroborate the main findings of the earlier studies, our approach also uncovers additional, thus far unrevealed patterns. A single dominant European borough with the Francophone network as its centre and that of Germany only regionally and internally connected. The UK business elite on the other hand is very present and prominent in this European structure of corporate close communication.

Covering a Graph with Clubs

“…A subgraph whose vertices are all distance at most s is called an s-club (notice that, when s = 1, an s-club is exactly a clique). The identification of s-clubs inside a network has been defined for the analysis of networks [21,1] and has been recently applied for the analysis of social networks [20,22,27], and biological networks [23,3]. Interesting recent studies have shown the relevance of finding s-clubs in a network [20,22], in particular focusing on finding 2-clubs in real networks like DBLP or a European corporate network.…”