Chapter 4. Does ethnic heterogeneity of clubs affect member dropout? 79 homophily, intergroup threat and social disarray – as well as their relation to either club members’ ingroup share or outgroup fractionalization. Homophily A key explanation in linking ethnic heterogeneity to member dropout is the simple principle that similarity breeds connection. Since its original formulation by Lazarsfeld and Merton (1954), decades of research on the homophily principle has shown that people are substantially more inclined to form and maintain ties with others if they have social characteristics in common (e.g. see McPherson & Smith-Lovin, 1987; McPherson et al., 2001). While the list of the traits that drive people together is long, few, if any, are found to have such a pronounced effect as ethnicity. Overall, individuals are much more likely to have ties to ethnic peers than to ethnic others and ethnic group membership operates as a major fault line in people’s networks (McPherson et al., 2001). Homophily has a profound impact on organizational dynamics because it produces selective recruitment and integration of members into organizations through multiple positive feedback loops (McPherson, Popielarz & Drobnic, 1992). Firstly, homophily leads to the recruitment of more members with similar characteristics to most of the current members because both prospective and current members favour ties to similar others and members of face-to-face groups tend to recruit acquaintances, which - as a result of homophily - tend to be similar to them. This carries over to the second point, namely that homophily influences how well members are integrated into a group. Selective recruitment means that dissimilar members will have fewer ties to co-members upon entry and that they are less likely to have existing ties to co-members who join after them. On top of that, the homophily principle dictates that over time these members will on average develop fewer ties to other co-members because they have less in common. Consequently, organizations exert substantially less pulling force on dissimilar members, especially for particularly homophily inducive characteristics such as ethnic background. Organizations do not exist in a social vacuum, however. Because the time and resources of individuals are limited, McPherson (1983) suggests organizations are best viewed as competing with one another over memberships as a scarce resource. This brings us to the third point, which is that members are also confronted with other groups and organizations which can act as a substitute for their current membership. The homophily principle implies that dissimilar
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