Fitness-dependent topological properties of the World Trade Web

TL;DR

This paper empirically tests the hidden variable model on the world trade web, showing that GDP distribution correlates with network topology and matches model predictions for various network properties.

Contribution

First empirical validation of the hidden variable model on a real-world network, linking GDP to topological features of the world trade web.

Findings

GDP follows a power-law distribution matching the hidden variable

Network properties align with model predictions

All network realizations with same degree sequence are equiprobable

Abstract

Among the proposed network models, the hidden variable (or good get richer) one is particularly interesting, even if an explicit empirical test of its hypotheses has not yet been performed on a real network. Here we provide the first empirical test of this mechanism on the world trade web, the network defined by the trade relationships between world countries. We find that the power-law distributed gross domestic product can be successfully identified with the hidden variable (or fitness) determining the topology of the world trade web: all previously studied properties up to third-order correlation structure (degree distribution, degree correlations and hierarchy) are found to be in excellent agreement with the predictions of the model. The choice of the connection probability is such that all realizations of the network with the same degree sequence are equiprobable.