FIGURE 2

Results of simulating changes to German ownership patterns by 'Rewiring' paths in the affiliation network among firms. This graph implements the simulation strategy shown in Figure 1 to the German ownership data and provides an analysis of the effects of randomly rewiring the ownership ties among German firms. The rewiring is conducted thousands of times, and the path length and clustering values are averaged over the iterations. The simulations show that there is little change in the path length, implying that the empirical path length is already near the random expectation. The clustering value begins to deteriorate after 38 rewirings of the links, indicating that it was not initially at the value for a random graph. This difference in behavior supports the claim that the German network is a small world, where the empirical clustering value differs more from its random counterpart than the does the empirical path length from its random counterpart.