Network Theory| The Flip Side of Metcalfe’s Law: Multiple and Growing Costs of Network Exclusion

The study of networks has grown recently, but most existing models fail to capture the costs or loss of value of exclusion from the network. Intuitively, as a network grows in size and value, those outside the network face growing disparities. We present a new framework for modeling network exclusion, and show that costs of exclusion can be absolute, and might, at the extreme, eventually grow ~exponentially, regardless of underlying network structure. We find costs of exclusion can also be spread to the “included,” through several mechanisms including parallel networks, and also highlight how future research needs to capture the interaction of alternate or parallel networks to the network at hand. Backed by empirical evidence, this will have wide-reaching policy and design implications, including the role of subsidies or direct intervention for network access and inclusion.