The organization of individuals into networks and groups is of fundamental importance in many social and economic interactions. Examples range from networks of personal contacts used to obtain information about job opportunities to the formation of trading partnerships, alliances, cartels, and federations. Much of our understanding of how and why such networks and groups form, and the precise way in which the network or groups structure affects outcomes of social and economic interaction, is relatively new. This volume collects some of the central papers in this recent literature, which have made important progress on this topic.