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What is a peer? The role of network definitions in estimation of endogenous peer effects

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  • Timothy J. Halliday
  • Sally Kwak

Abstract

We employ a standard identification strategy from the peer effects literature to investigate the importance of network definitions in estimation of endogenous peer effects. We use detailed information on friends in the National Longitudinal Study of Adolescent Health Survey (Add Health) to construct two network definitions that are less ad hoc than the school-grade cohorts commonly used in the educational peer effects literature. We demonstrate that accurate definitions of the network seriously impact estimation of peer effects. In particular, we show that peer effects estimates on educational achievement, smoking and drinking are substantially larger with our more detailed measures than with the school-grade cohorts. These results highlight the need to further understand how friendships form in order to fully understand implications for policy that alters the peer group mix at the classroom or cohort level.

Suggested Citation

  • Timothy J. Halliday & Sally Kwak, 2012. "What is a peer? The role of network definitions in estimation of endogenous peer effects," Applied Economics, Taylor & Francis Journals, vol. 44(3), pages 289-302, January.
    • Handle: RePEc:taf:applec:44:y:2012:i:3:p:289-302
    DOI: 10.1080/00036846.2010.505557
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    References listed on IDEAS

    as
    1. Mary A. Burke & Tim R. Sass, 2013. "Classroom Peer Effects and Student Achievement," Journal of Labor Economics, University of Chicago Press, vol. 31(1), pages 51-82.
    2. Caroline Hoxby, 2000. "Peer Effects in the Classroom: Learning from Gender and Race Variation," NBER Working Papers 7867, National Bureau of Economic Research, Inc.
    3. Bruce A. Weinberg, 2007. "Social Interactions with Endogenous Associations," NBER Working Papers 13038, National Bureau of Economic Research, Inc.
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    More about this item

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I20 - Health, Education, and Welfare - - Education - - - General

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