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A discrete choice model with social interactions; with an application to high school teen behavior

  • Soetevent, Adriaan R.
  • Kooreman, Peter

    (Groningen University)

We develop an empirical discrete choice interaction model with a finite number of agents. We characterize its equilibrium properties - in particular the correspondence between the interaction strength, the number of agents, and the set of equilibria - and propose to estimate the model by means of simulation methods. In an empirical application, we analyze the individual behavior of some 8000 high school teenagers from almost 500 different school classes. We find endogenous social interaction effects to be strong for behavior closely related to school (truancy), somewhat weaker for behavior partly related to school (smoking, cell phone ownership, and moped ownership) and absent for behavior far away from school (asking parents' permission for purchases). Intra-gender interactions are generally much stronger than cross-gender interactions

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File URL: http://irs.ub.rug.nl/ppn/263316173
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Paper provided by University of Groningen, CCSO Centre for Economic Research in its series CCSO Working Papers with number 200401.

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Date of creation: 2004
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Handle: RePEc:dgr:rugccs:200401
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  1. Peter Arcidiacono & Sean Nicholson, 2002. "Peer Effects in Medical School," NBER Working Papers 9025, National Bureau of Economic Research, Inc.
  2. Aronsson, Thomas & Blomquist, Soren & Sacklen, Hans, 1999. "Identifying Interdependent Behaviour in an Empirical Model of Labour Supply," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 14(6), pages 607-26, Nov.-Dec..
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