The emergence of sharing networks through indirect signaling

Communities around the world rely on networks of resource sharing to buffer households against hardship. Yet, under such informal insurance schemes, some needy families can be systematically left out. By modeling sharing and reputational spread on a network, we show how generosity can be sustained when reputational benefits spread across a community’s communication network, but also how network density and position shape who receives transfers---well-connected households become priority receivers due to their ability to spread givers' reputation more effectively. Our analysis, combining mathematical modeling with food sharing data from an Inuit community, reveals that communication network sparsity incentivizes broader sharing, but also more selectivity. The correlation of communication network structure and resource endowment is critical for stabilizing needs-based transfers. If need status does not perfectly (negatively) correlate with social influence, marginal households in need may still be excluded from sharing. By linking individual incentives to community-wide patterns, our framework clarifies when indirect reciprocity can stabilize outcomes that show the signatures of need-based transfers.