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Peer Effects in Education, Sport, and Screen Activities: Local Aggregate or Local Average?

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  • Liu, Xiaodong
  • Patacchini, Eleonora
  • Zenou, Yves

Abstract

We develop two different social network models with different economic foundations. In the local-aggregate model, it is the sum of friends' efforts in some activity that affects the utility of each individual while, in the local-average model, it is costly to deviate from the average effort of friends. Even though the two models are fundamentally different in terms of behavioral foundation, their implications in terms of Nash equilibrium are relatively close since only the adjacency (social interaction) matrix differs in equilibrium, one being the row-normalized version of the other. We test these alternative mechanisms of social interactions to study peer effects in education, sport and screen activities for adolescents in the United States using the AddHealth data. We extend Kelejian's (2008) J test for spatial econometric models helping differentiate between these two behavioral models. We find that peer effects are not significant for screen activities (like e.g. video games). On the contrary, for sport activities, we find that students are mostly influenced by the aggregate activity of their friends (local-aggregate model) while, for education, we show that both the aggregate performance at school of friends and conformism matter, even though the magnitude of the effect is higher for the latter.

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  • Liu, Xiaodong & Patacchini, Eleonora & Zenou, Yves, 2011. "Peer Effects in Education, Sport, and Screen Activities: Local Aggregate or Local Average?," CEPR Discussion Papers 8477, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:8477
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    Cited by:

    1. Jackson, Matthew O. & Zenou, Yves, 2015. "Games on Networks," Handbook of Game Theory with Economic Applications,, Elsevier.
    2. Christian Ghiglino, 2011. "When Veblen meets Krugman," 2011 Meeting Papers 768, Society for Economic Dynamics.
    3. Eleonora Patacchini & Edoardo Rainone, 2014. "The Word on Banking - Social Ties, Trust, and the Adoption of Financial Products," EIEF Working Papers Series 1404, Einaudi Institute for Economics and Finance (EIEF), revised Jul 2014.
    4. Boucher, Vincent, 2016. "Conformism and self-selection in social networks," Journal of Public Economics, Elsevier, vol. 136(C), pages 30-44.
    5. Kim, Changjoo & Parent, Olivier, 2016. "Modeling individual travel behaviors based on intra-household interactions," Regional Science and Urban Economics, Elsevier, vol. 57(C), pages 1-11.
    6. David M. Brasington & Olivier Parent, 2017. "Public school consolidation: a partial observability spatial bivariate probit approach," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 180(2), pages 633-656, February.
    7. Christian Ghiglino & Antonella Nocco, 2017. "When Veblen meets Krugman: social network and city dynamics," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 63(2), pages 431-470, February.
    8. Carlos Medina & Jorge Andrés Tamayo & Christian Posso, 2013. "The Effect of Adult Criminals´ Spillovers On the Likelihood of Youths Becoming Criminals," BORRADORES DE ECONOMIA 010461, BANCO DE LA REPÚBLICA.
    9. Han, Xiaoyi & Lee, Lung-fei, 2013. "Model selection using J-test for the spatial autoregressive model vs. the matrix exponential spatial model," Regional Science and Urban Economics, Elsevier, vol. 43(2), pages 250-271.
    10. Aliaksandr Amialchuk & Ales Kotalik, 2016. "Do Your School Mates Influence How Long You Game? Evidence from the U.S," PLOS ONE, Public Library of Science, vol. 11(8), pages 1-16, August.
    11. Christian Ghiglino, 2011. "When Veblen meets Krugman," 2011 Meeting Papers 768, Society for Economic Dynamics.

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    Keywords

    conformism; econometrics of networks; peer effects; Social networks;
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    JEL classification:

    • A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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