Thesis: I study network formation and farsighted behavior theoretically and empirically using both observational and experimental data. The first chapter develops a structural estimation method for measuring network externalities. The second chapter develops a solution concept aiming to capture farsighted behavior in abstract games, which encompass network formation games as a special case. The third chapter tests the predictive power of various myopic and farsighted solution concepts in the context of a network formation game played in the lab.