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Social Interactions and Schooling Decisions

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  • Rafael Lalive
  • Alejandra Cattaneo

Abstract

The aim of this paper is to study whether schooling choices are affected by social interactions. Such social interactions may be important because children enjoy spending time with other children or parents learn from other parents about the ability of their children. Identification is based on a randomized intervention that grants a cash subsidy encouraging school attendance among a sub-group of eligible children within small rural villages in Mexico. Results indicate that (i) the eligible children tend to attend school more frequently, (ii) but also the ineligible children acquire more schooling when the subsidy is introduced in their local village, (iii) social interactions are economically important, and (iv) they may arise due to changes in parents’ perception of their children’s ability.

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Bibliographic Info

Paper provided by Institute for Empirical Research in Economics - University of Zurich in its series IEW - Working Papers with number 298.

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Date of creation: Aug 2006
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Handle: RePEc:zur:iewwpx:298

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Keywords: peer effects; schooling; field experiment; PROGRESA.;

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References

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  1. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier.
  2. Buddelmeyer, Hielke & Skoufias, Emmanuel, 2004. "An evaluation of the performance of regression discontinuity design on PROGRESA," Policy Research Working Paper Series 3386, The World Bank.
  3. Charles F. Manski, 2000. "Economic Analysis of Social Interactions," NBER Working Papers 7580, National Bureau of Economic Research, Inc.
  4. Esther Duflo & Emmanuel Saez, 2003. "The Role Of Information And Social Interactions In Retirement Plan Decisions: Evidence From A Randomized Experiment," The Quarterly Journal of Economics, MIT Press, vol. 118(3), pages 815-842, August.
  5. Joshua D. Angrist & Kevin Lang, 2004. "Does School Integration Generate Peer Effects? Evidence from Boston's Metco Program," American Economic Review, American Economic Association, vol. 94(5), pages 1613-1634, December.
  6. Edward L. Glaeser & Bruce I. Sacerdote & Jose A. Scheinkman, 2003. "The Social Multiplier," Journal of the European Economic Association, MIT Press, vol. 1(2-3), pages 345-353, 04/05.
  7. Paul Gertler, 2004. "Do Conditional Cash Transfers Improve Child Health? Evidence from PROGRESA's Control Randomized Experiment," American Economic Review, American Economic Association, vol. 94(2), pages 336-341, May.
  8. Jacob M. Markman & Eric A. Hanushek & John F. Kain & Steven G. Rivkin, 2003. "Does peer ability affect student achievement?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 18(5), pages 527-544.
  9. Bruce Sacerdote, 2000. "Peer Effects with Random Assignment: Results for Dartmouth Roommates," NBER Working Papers 7469, National Bureau of Economic Research, Inc.
  10. Caroline Hoxby, 2000. "Peer Effects in the Classroom: Learning from Gender and Race Variation," NBER Working Papers 7867, National Bureau of Economic Research, Inc.
  11. Anne C. Case & Lawrence F. Katz, 1991. "The Company You Keep: The Effects of Family and Neighborhood on Disadvantaged Youths," NBER Working Papers 3705, National Bureau of Economic Research, Inc.
  12. Lalive, Rafael, 2003. "Social Interactions in Unemployment," IZA Discussion Papers 803, Institute for the Study of Labor (IZA).
  13. George A. Akerlof & Rachel E. Kranton, 2002. "Identity and Schooling: Some Lessons for the Economics of Education," Journal of Economic Literature, American Economic Association, vol. 40(4), pages 1167-1201, December.
  14. Kremer, Michael & Miguel, Edward & Thornton, Rebecca & Ozier, Owen, 2005. "Incentives to learn," Policy Research Working Paper Series 3546, The World Bank.
  15. repec:att:wimass:9217 is not listed on IDEAS
  16. Edward E. Glaeser & Bruce Sacerdote & Jose A. Scheinkman, 1995. "Crime and Social Interactions," Harvard Institute of Economic Research Working Papers 1738, Harvard - Institute of Economic Research.
  17. Charles F. Manski, 2004. "Social Learning from Private Experiences: The Dynamics of the Selection Problem," Review of Economic Studies, Oxford University Press, vol. 71(2), pages 443-458.
  18. Edward Miguel & Michael Kremer, 2004. "Worms: Identifying Impacts on Education and Health in the Presence of Treatment Externalities," Econometrica, Econometric Society, vol. 72(1), pages 159-217, 01.
  19. Behrman, Jere R & Sengupta, Piyali & Todd, Petra, 2005. "Progressing through PROGRESA: An Impact Assessment of a School Subsidy Experiment in Rural Mexico," Economic Development and Cultural Change, University of Chicago Press, vol. 54(1), pages 237-75, October.
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