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Peer Effects and Multiple Equilibria in the Risky Behavior of Friends

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Author Info

  • David Card

    (University of California Berkeley and NBER)

  • Laura Giuliano

    (University of Miami)

Abstract

We study social interactions in the initiation of sex and other risky behaviors by best friend pairs in the Add Health panel. Focusing on friends with minimal experience at the baseline interview, we estimate bivariate ordered-choice models that include both peer effects and unobserved heterogeneity. We find significant peer effects in sexual initiation: the likelihood of initiating intercourse within a year increases by almost 5 percentage points (on an 11% base rate) if one's friend also initiates intercourse. Similar effects are present for smoking, marijuana use, and truancy. We find larger effects for females and important asymmetries in nonreciprocated friendships. © 2013 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/REST_a_00340
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Bibliographic Info

Article provided by MIT Press in its journal Review of Economics and Statistics.

Volume (Year): 95 (2013)
Issue (Month): 4 (October)
Pages: 1130-1149

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Handle: RePEc:tpr:restat:v:95:y:2013:i:4:p:1130-1149

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Web page: http://mitpress.mit.edu/journals/

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Related research

Keywords: peer effeccts; sexual initiation; risky behavior;

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References

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  1. Stinebrickner, Ralph & Stinebrickner, Todd R., 2006. "What can be learned about peer effects using college roommates? Evidence from new survey data and students from disadvantaged backgrounds," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1435-1454, September.
  2. Yann Bramoullé & Habiba Djebbari & Bernard Fortin, 2007. "Identification of Peer Effects through Social Networks," Cahiers de recherche 0705, CIRPEE.
  3. Krauth, Brian V., 2006. "Simulation-based estimation of peer effects," Journal of Econometrics, Elsevier, vol. 133(1), pages 243-271, July.
  4. Scott E. Carrell & Richard L. Fullerton & James E. West, 2008. "Does Your Cohort Matter? Measuring Peer Effects in College Achievement," NBER Working Papers 14032, National Bureau of Economic Research, Inc.
  5. Kooreman, Peter & Soetevent, Adriaan, 2002. "A discrete choice model with social interactions: an analysis of high school teen behavior," CCSO Working Papers 200214, University of Groningen, CCSO Centre for Economic Research.
  6. David J. Zimmerman, 2003. "Peer Effects in Academic Outcomes: Evidence from a Natural Experiment," The Review of Economics and Statistics, MIT Press, vol. 85(1), pages 9-23, February.
  7. Brian Krauth, 2004. "Peer and selection effects on youth smoking in California," HEW 0408002, EconWPA.
  8. Giacomo De Giorgi & Michele Pellizzari & Silvia Redaelli, 2010. "Identification of Social Interactions through Partially Overlapping Peer Groups," American Economic Journal: Applied Economics, American Economic Association, vol. 2(2), pages 241-75, April.
  9. Federico Ciliberto & Elie Tamer, 2009. "Market Structure and Multiple Equilibria in Airline Markets," Econometrica, Econometric Society, vol. 77(6), pages 1791-1828, November.
  10. Patrick Bajari & Han Hong & Stephen Ryan, 2004. "Identification and Estimation of Discrete Games of Complete Information," NBER Technical Working Papers 0301, National Bureau of Economic Research, Inc.
  11. Bresnahan, Timothy F. & Reiss, Peter C., 1991. "Empirical models of discrete games," Journal of Econometrics, Elsevier, vol. 48(1-2), pages 57-81.
  12. Halliday, Timothy J. & Kwak, Sally, 2008. "Weight Gain in Adolescents and Their Peers," IZA Discussion Papers 3610, Institute for the Study of Labor (IZA).
  13. Huang, Ching-I, 2008. "Intra-Household Effects on Demand for Telephone Service: Empirical Evidence," MPRA Paper 6813, University Library of Munich, Germany.
  14. Laura M. Argys & Daniel I. Rees, 2008. "Searching for Peer Group Effects: A Test of the Contagion Hypothesis," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 442-458, August.
  15. Roland G. Fryer, Jr. & Paul Torelli, 2005. "An Empirical Analysis of 'Acting White'," NBER Working Papers 11334, National Bureau of Economic Research, Inc.
  16. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2005. "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools," Journal of Political Economy, University of Chicago Press, vol. 113(1), pages 151-184, February.
  17. Elie Tamer, 2003. "Incomplete Simultaneous Discrete Response Model with Multiple Equilibria," Review of Economic Studies, Wiley Blackwell, vol. 70(1), pages 147-165, January.
  18. Dean R. Hyslop, 1999. "State Dependence, Serial Correlation and Heterogeneity in Intertemporal Labor Force Participation of Married Women," Econometrica, Econometric Society, vol. 67(6), pages 1255-1294, November.
  19. Scott E. Carrell & Bruce I. Sacerdote & James E. West, 2011. "From Natural Variation to Optimal Policy? The Lucas Critique Meets Peer Effects," NBER Working Papers 16865, National Bureau of Economic Research, Inc.
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Citations

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Cited by:
  1. Sarah Grace See, 2013. "The Riskiest of Them All: Parental Supervision and Adolescent Behaviors," CHILD Working Papers Series 21, Centre for Household, Income, Labour and Demographic Economics (CHILD) - CCA.
  2. Effrosyni Adamopoulou, 2012. "Peer Effects in Young Adults' Marital Decisions," Economics Working Papers we1228, Universidad Carlos III, Departamento de Economía.
  3. Albrecht Glitz, 2013. "Coworker Networks in the Labour Market," CESifo Working Paper Series 4250, CESifo Group Munich.
  4. Lindquist, Matthew J. & Zenou, Yves, 2014. "Key Players in Co-Offending Networks," IZA Discussion Papers 8012, Institute for the Study of Labor (IZA).
  5. Jeremy Fox & Natalia Lazzati, 2013. "Identification of discrete choice models for bundles and binary games," CeMMAP working papers CWP04/13, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  6. Ciliberto, Federico & Miller, Amalia & Skyt Nielsen, Helena & Simonsen, Marianne, 2013. "Playing the Fertility Game at Work: An Equilibrium Model of Peer Effects," MPRA Paper 45914, University Library of Munich, Germany.
  7. Yann Bramoull? & Rachel Kranton & Martin D'Amours, 2014. "Strategic Interaction and Networks," American Economic Review, American Economic Association, vol. 104(3), pages 898-930, March.
  8. Eisenberg, Daniel & Golberstein, Ezra & Whitlock, Janis L., 2014. "Peer effects on risky behaviors: New evidence from college roommate assignments," Journal of Health Economics, Elsevier, vol. 33(C), pages 126-138.
  9. Effrosyni Adamopoulou & Ezgi Kaya, 2013. "Young adults living with their parents and the influence of peers," Economics Working Papers we1310, Universidad Carlos III, Departamento de Economía.
  10. Goux, Dominique & Gurgand, Marc & Maurin, Eric, 2014. "Adjusting Your Dreams? The Effect of School and Peers on Dropout Behaviour," IZA Discussion Papers 7948, Institute for the Study of Labor (IZA).
  11. Jeremy T. Fox & Natalia Lazzati, 2012. "Identification of Potential Games and Demand Models for Bundles," NBER Working Papers 18155, National Bureau of Economic Research, Inc.

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