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Identifying Peer Effects under Reflection: A Panel-Data Approach

Author

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  • Gong, Xiaodong

    (University of Canberra)

  • Freyens, Benoit

    (University of Canberra)

Abstract

We propose a new approach to identifying peer effects that addresses the reflection problem by using the timing of decisions. The approach combines panel data with the ordering of decisions to separate peer influence from simultaneity. Variation in the order of decisions and in exposure to peers provides the basis for identification, allowing estimation of peer effects in settings where standard approaches are not informative. We illustrate the method using a multi-level panel of more than 2,000 judicial rulings over a 16-year period, where cases are randomly assigned to judges. The data allow us to implement the approach and examine the sources of peer influence. We find heterogeneous and asymmetric responses, with both the magnitude and direction of effects differing across types.

Suggested Citation

  • Gong, Xiaodong & Freyens, Benoit, 2026. "Identifying Peer Effects under Reflection: A Panel-Data Approach," IZA Discussion Papers 18808, IZA Network @ LISER.
    • Handle: RePEc:iza:izadps:dp18808
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    References listed on IDEAS

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    JEL classification:

    • C18 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Methodolical Issues: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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