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This study primarily seeks to answer the following question: How do social networks evolve over time and affect individual economic activity? To provide an adequate empirical tool to answer this question, we propose a new modeling approach for longitudinal data of networks and activity outcomes. The key features of our model are the inclusion of dynamic effects and the use of time-varying latent variables to determine unobserved individual traits in network formation and activity interactions.doi:10.6084/m9.figshare.8794988.v1 fatcat:i4yi2s7abbgmpgux2cpn5pavva