Specification and Estimation of Heterogeneous Diffusion Models

Abstract

Heterogeneous diffusion models let one combine the analysis of intrinsic propensities with that of intrapopulation contagion, and to disaggregate contagion effects into individual susceptibilities, the infectiousness of prior adopters, and the social proximity of prior-potential adopter pairs. This paper reports the results of a series of Monte Carlo simulation studies that investigate estimation issues for this class of models. Graphical analysis of population-level hazard rates is shown to provide little insight into these processes. We focus on the properties of maximum likelihood estimators, considering variation across parameter values and differentforms of model misspecification. When models are correctly specified, we find few conditions under which estimation appears problematic. Difficult cases involve binary networks where network linkages have very strong effects or network density is high. Estimation deteriorates in