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The Role of Social Networks and Peer Effects in Education Transmission

  • Sebastian Bervoets

    ()

    (CNRS, Greqam)

  • Antoni Calvó-Armengol

    (This author is deceased (Date: 03 Nov 2007))

  • Yves Zenou

    ()

    (Stockholm University, IFN)

We propose a dynastic model in which individuals are born in an educated or uneducated environment that they inherit from their parents. We study the role of social networks on the correlation in the parent-child educational status independent of any parent-child interaction. We show that the network reduces the intergenerational correlation, promotes social mobility and increases the average education level in the population. We also show that a planner that encourages social mobility also reduces social welfare, hence facing a tradeoff between these two objectives. When individuals choose the optimal level of social mobility, those born in an uneducated environment always want to leave their environment while the reverse occurs for individuals born in an educated environment.

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File URL: http://www.amse-aixmarseille.fr/sites/default/files/_dt/2012/wp_2012_-_nr_09.pdf
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Paper provided by Aix-Marseille School of Economics, Marseille, France in its series AMSE Working Papers with number 1209.

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Length: 38 pages
Date of creation: 30 Mar 2012
Date of revision:
Handle: RePEc:aim:wpaimx:1209
Contact details of provider: Web page: http://www.amse-aixmarseille.fr/en

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  2. Ladd, Helen F & Ludwig, Jens, 1997. "Federal Housing Assistance, Residential Relocation, and Educational Opportunities: Evidence from Baltimore," American Economic Review, American Economic Association, vol. 87(2), pages 272-77, May.
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  4. Calvo-Armengol, Antoni & Verdier, Thierry & Zenou, Yves, 2007. "Strong and weak ties in employment and crime," Journal of Public Economics, Elsevier, vol. 91(1-2), pages 203-233, February.
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  7. Calvó-Armengol, Antoni & Patacchini, Eleonora & Zenou, Yves, 2008. "Peer Effects and Social Networks in Education," IZA Discussion Papers 3859, Institute for the Study of Labor (IZA).
  8. Yannis M. Ioannides & Linda Datcher Loury, 2002. "Job Information Networks, Neighborhood Effects and Inequality," Discussion Papers Series, Department of Economics, Tufts University 0217, Department of Economics, Tufts University.
  9. de Bartolome, Charles A M, 1990. "Equilibrium and Inefficiency in a Community Model with Peer Group Effects," Journal of Political Economy, University of Chicago Press, vol. 98(1), pages 110-33, February.
  10. Pekkarinen, Tuomas & Uusitalo, Roope & Kerr, Sari, 2009. "School tracking and intergenerational income mobility: Evidence from the Finnish comprehensive school reform," Journal of Public Economics, Elsevier, vol. 93(7-8), pages 965-973, August.
  11. Dominique Goux & Eric Maurin, 2007. "Close Neighbours Matter: Neighbourhood Effects on Early Performance at School," Economic Journal, Royal Economic Society, vol. 117(523), pages 1193-1215, October.
  12. Yannis Ioannides, 2003. "Empirical nonlinearities and neighbourhood effects in the intergenerational transmission of human capital," Applied Economics Letters, Taylor & Francis Journals, vol. 10(9), pages 535-539.
  13. Eleonora Patacchini & Yves Zenou, 2011. "Neighborhood Effects And Parental Involvement In The Intergenerational Transmission Of Education," Journal of Regional Science, Wiley Blackwell, vol. 51(5), pages 987-1013, December.
  14. Bisin, A. & Verdier, T., 1999. "Beyond the Melting Pot: Cultural Transmission, Marriage, and the Evolution of Ethnic and Religious Traits," Papers 1999-10, Laval - Laboratoire Econometrie.
  15. Costas Meghir & Mårten Palme, 2005. "Educational Reform, Ability, and Family Background," American Economic Review, American Economic Association, vol. 95(1), pages 414-424, March.
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  17. Thomas Piketty, 1994. "Social Mobility and Redistributive Politics," Working papers 94-15, Massachusetts Institute of Technology (MIT), Department of Economics.
  18. Björklund, Anders & Lindahl, Mikael & Plug, Erik, 2005. "The Origins of Intergenerational Associations: Lessons from Swedish Adoption Data," IZA Discussion Papers 1739, Institute for the Study of Labor (IZA).
  19. Ermisch, John & Francesconi, Marco, 2001. "Family Matters: Impacts of Family Background on Educational Attainments," Economica, London School of Economics and Political Science, vol. 68(270), pages 137-56, May.
  20. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, vol. 65(5), pages 1005-1028, September.
  21. Lawrence F. Katz & Jeffrey R. Kling & Jeffrey B. Liebman, 2000. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," NBER Working Papers 7973, National Bureau of Economic Research, Inc.
  22. Plug, Erik & Vijverberg, Wim, 2000. "Schooling, Family Background, and Adoption: Is It Nature of Is It Nurture?," Discussion Papers 736, The Research Institute of the Finnish Economy.
  23. Bruce Sacerdote, 2000. "The Nature and Nurture of Economic Outcomes," NBER Working Papers 7949, National Bureau of Economic Research, Inc.
  24. Jonathan Guryan, 2001. "Desegregation and Black Dropout Rates," NBER Working Papers 8345, National Bureau of Economic Research, Inc.
  25. Aakvik, Arild & Salvanes, Kjell G. & Vaage, Kjell, 2010. "Measuring heterogeneity in the returns to education using an education reform," European Economic Review, Elsevier, vol. 54(4), pages 483-500, May.
  26. Sanjeev Goyal, 2007. "Introduction to Connections: An Introduction to the Economics of Networks
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  27. Benabou, Roland, 1993. "Workings of a City: Location, Education, and Production," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 619-52, August.
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