1932
0
  1. Home
  2. A-Z Publications
  3. Annual Review of Economics
  4. Volume 6, 2014
  5. Article

Annual Review of Economics

Volume 6, 2014

Experimental and Quasi-Experimental Analysis of Peer Effects: Two Steps Forward?

Abstract

In the past 10 years, there has been an explosion of well-identified studies that measure peer effects across many settings and for many outcomes. The emphasis on natural experiments and randomization is a highly useful one; in more standard observational studies, the self-selection of people into peer groups can make the measurement of peer effects extremely difficult. In the absence of exogenous variation, knowing that people have similar outcomes as their friends, classmates, and coworkers may tell us little about peer effects. I examine the successes, failures, and findings of experimental analyses of peer effects. I draw three broad conclusions. First, even more than in other areas of social science, the size and nature of peer effects estimated are highly context specific; peer effects in student test scores and grades are prominent in some cases and absent in others. That said, there is a pattern across studies suggesting that social outcomes (e.g., crime, drinking behavior) and career choices show larger peer influences than do test scores. Second, researchers have shown that the linear-in-means model of peer effects is often not a good description of the world, although we do not yet have an agreed-upon model to replace it. Third, despite potential temptation, we have not reached the point at which we can reliably use knowledge of peer effects to implement policies that improve outcomes for students and other human subjects.

Keyword(s): social interactions in education
Loading

Article metrics loading...

/content/journals/10.1146/annurev-economics-071813-104217
2014-08-02
2024-04-19
Loading full text...

Full text loading...

/deliver/fulltext/economics/6/1/annurev-economics-071813-104217.html?itemId=/content/journals/10.1146/annurev-economics-071813-104217&mimeType=html&fmt=ahah

Literature Cited

  1. Abdulkadiroglu A, Angrist JD, Pathak PA. 2014. The elite illusion: achievement effects at Boston and New York exam schools. Econometrica 82:137–96 [Google Scholar]
  2. Ahern KR, Duchin R, Shumway T. 2012. Peer effects in economic attitudes. Work. Pap., Univ. Mich., Ann Arbor
  3. Anderson M, Lu F. 2012. Peer effects in microenvironments: the benefits of homogeneous classroom groups. Work. Pap., Univ. Calif., Berkeley
  4. Angrist JD, Lang K. 2004. Does school integration generate peer effects? Evidence from Boston's METCO program. Am. Econ. Rev. 94:1613–34 [Google Scholar]
  5. Arcidiacono P, Nicholson S. 2005. Peer effects in medical school. J. Public Econ. 89:327–50 [Google Scholar]
  6. Austen-Smith D, Fryer RG Jr. 2005. An economic analysis of “acting white.”. Q. J. Econ. 120:551–83 [Google Scholar]
  7. Babcock PS, Hartman JL. 2010. Networks and workouts: treatment size and status specific peer effects in a randomized field experiment. NBER Work. Pap. 16581
  8. Beshears J, Choi JJ, Laibson D, Madrian BC, Milkman KL. 2011. The effect of providing peer information on retirement savings decisions. NBER Work. Pap. 17345
  9. Billings SB, Deming DJ, Rockoff J. 2014. School segregation, educational attainment and crime: evidence from the end of busing in Charlotte-Mecklenburg. Q. J. Econ. 129:435–76 [Google Scholar]
  10. Boisjoly J, Duncan GJ, Kremer M, Levy DM, Eccles J. 2006. Empathy or antipathy? The impact of diversity. Am. Econ. Rev. 96:1890–905 [Google Scholar]
  11. Bramoullé Y, Djebbari H, Fortin B. 2009. Identification of peer effects through social networks. J. Econom. 150:41–55 [Google Scholar]
  12. Carrell SE, Fullerton RL, West JE. 2009. Does your cohort matter? Measuring peer effects in college achievement. J. Labor Econ. 27:439–64 [Google Scholar]
  13. Carrell SE, Hoekstra M, West JE. 2011. Is poor fitness contagious? Evidence from randomly assigned friends. J. Public Econ. 23:657–63 [Google Scholar]
  14. Carrell SE, Malmstrom FV, West JE. 2008. Peer effects in academic cheating. J. Hum. Resour. 43:173–207 [Google Scholar]
  15. Carrell SE, Sacerdote BI, West JE. 2013. From natural variation to optimal policy? The importance of endogenous peer group formation. Econometrica 81:855–82 [Google Scholar]
  16. Case AC, Katz LF. 1991. The company you keep: the effects of family and neighborhood on disadvantaged youths. NBER Work. Pap. 3705
  17. Christakis NA, Fowler JH. 2007. The spread of obesity in a large social network over 32 years. N. Engl. J. Med. 357:370–79 [Google Scholar]
  18. Cohen-Cole E, Fletcher JM. 2008. Is obesity contagious? Social networks vs. environmental factors in the obesity epidemic. J. Health Econ. 27:1382–87 [Google Scholar]
  19. Coleman JS, Campbell E, Hobson C, McPartland J, Mood A et al. 1966. Equality of educational opportunity. Rep., US Dep. Health Educ. Welf., Off. Ed., Washington, DC
  20. Dahl GB, Løken KV, Mogstad M. 2012. Peer effects in program participation. NBER Work. Pap. 18198
  21. Damm AP, Dustmann C. 2012. Does growing up in a high crime neighborhood affect youth criminal behavior? Work. Pap., Univ. Coll. London
  22. De Giorgi G, Pellizzari M, Redaelli S. 2010. Identification of social interactions through partially overlapping peer groups. Am. Econ. J. Appl. Econ. 2:241–75 [Google Scholar]
  23. Duflo E, Saez E. 2003. The role of information and social interactions in retirement plan decisions: evidence from a randomized experiment. Q. J. Econ. 118:815–42 [Google Scholar]
  24. Duncan GJ, Boisjoly J, Kremer M, Levy DM, Eccles J. 2005. Peer effects in drug use and sex among college students. J. Abnorm. Child Psychol. 33:375–85 [Google Scholar]
  25. Falk A, Ichino A. 2006. Clean evidence on peer effects. J. Labor Econ. 24:39–57 [Google Scholar]
  26. Foster G. 2006. It's not your peers, and it's not your friends: some progress toward understanding the educational peer effect mechanism. J. Public Econ. 90:1455–75 [Google Scholar]
  27. Glaeser EL, Sacerdote B, Scheinkman JA. 1996. Crime and social interactions. Q. J. Econ. 111:507–48 [Google Scholar]
  28. Gould ED, Lavy V, Paserman MD. 2009. Does immigration affect the long-term educational outcomes of natives? Quasi-experimental evidence. Econ. J. 119:1243–69 [Google Scholar]
  29. Graham BS. 2008. Identifying social interactions through conditional variance restrictions. Econometrica 76:643–60 [Google Scholar]
  30. Harris JR. 2009. The Nurture Assumption: Why Children Turn Out the Way They Do New York: Free
  31. Hoel J, Parker J, Rivenburg J. 2006. A test for classmate peer effects in higher education. Work. Pap., Reed Coll., Portland
  32. Hoxby C. 2000a. Peer effects in the classroom: learning from gender and race variation. NBER Work. Pap. 7867
  33. Hoxby CM. 2000b. The effects of class size on student achievement: new evidence from population variation. Q. J. Econ. 115:1239–85 [Google Scholar]
  34. Hoxby CM, Weingarth G. 2005. Taking race out of the equation: school reassignment and the structure of peer effects. Work. Pap., Harvard Univ., Cambridge, MA
  35. Imberman SA, Kugler AD, Sacerdote BI. 2012. Katrina's children: evidence on the structure of peer effects from hurricane evacuees. Am. Econ. Rev. 102:2048–82 [Google Scholar]
  36. Jackson C K. 2013. Can higher-achieving peers explain the benefits to attending selective schools? Evidence from Trinidad and Tobago. J. Public Econ. 108:63–77 [Google Scholar]
  37. Kling JR, Ludwig J, Katz LF. 2005. Neighborhood effects on crime for female and male youth: evidence from a randomized housing voucher experiment. Q. J. Econ. 120:87–130 [Google Scholar]
  38. Kuhn P, Kooreman P, Soetevent A, Kapteyn A. 2011. The effects of lottery prizes on winners and their neighbors: evidence from the Dutch Postcode Lottery. Am. Econ. Rev. 101:2226–47 [Google Scholar]
  39. Lavy V, Schlosser A. 2011. Mechanisms and impacts of gender peer effects at school. Am. Econ. J. Appl. Econ. 3:1–33 [Google Scholar]
  40. Lerner J, Malmendier U. 2013. With a little help from my (random) friends: success and failure in post-business school entrepreneurship. Rev. Financ. Stud. 26:2411–52 [Google Scholar]
  41. Ludwig J, Duncan GJ, Hirschfield P. 2001. Urban poverty and juvenile crime: evidence from a randomized housing-mobility experiment. Q. J. Econ. 116:655–79 [Google Scholar]
  42. Lyle DS. 2009. The effects of peer group heterogeneity on the production of human capital at West Point. Am. Econ. J. Appl. Econ. 1:69–84 [Google Scholar]
  43. Manski CF. 1993. Identification of endogenous social effects: the reflection problem. Rev. Econ. Stud. 60:531–42 [Google Scholar]
  44. Marmaros D, Sacerdote B. 2002. Peer and social networks in job search. Eur. Econ. Rev. 46:870–79 [Google Scholar]
  45. Marmaros D, Sacerdote B. 2006. How do friendships form?. Q. J. Econ. 121:79–119 [Google Scholar]
  46. Moffitt RA. 2001. Policy interventions, low-level equilibria, and social interactions. Social Dynamics Durlauf SN, Young HP. 45–82 Washington, DC: Brookings Inst. [Google Scholar]
  47. Sacerdote B. 2000. Peer effects with random assignment: results for Dartmouth roommates. NBER Work. Pap. 7469
  48. Sacerdote B. 2001. Peer effects with random assignment: results for Dartmouth roommates. Q. J. Econ. 116:681–704 [Google Scholar]
  49. Shue K. 2013. Executive networks and firm policies: evidence from the random assignment of MBA peers. Rev. Financ. Stud. 26:1401–42 [Google Scholar]
  50. Siegfried JJ, Gleason MA. 2006. Academic roommate peer effects. Unpublished manuscript, Vanderbilt Univ., Nashville
  51. Stinebrickner R, Stinebrickner TR. 2005. How much does studying matter? Proc. Fed. Reserve Bank Clevel., pp. 55–59. Cleveland, OH: Fed. Reserve Bank Clevel.
  52. Stinebrickner R, Stinebrickner TR. 2006. What can be learned about peer effects using college roommates? Evidence from new survey data and students from disadvantaged backgrounds. J. Public Econ. 90:1435–54 [Google Scholar]
  53. Summers AA, Wolfe BL. 1977. Do schools make a difference?. Am. Econ. Rev. 67:639–52 [Google Scholar]
  54. Waldinger F. 2012. Peer effects in science: evidence from the dismissal of scientists in Nazi Germany. Rev. Econ. Stud. 79:838–61 [Google Scholar]
  55. Zimmerman DJ. 2003. Peer effects in academic outcomes: evidence from a natural experiment. Rev. Econ. Stat. 85:9–23 [Google Scholar]
/content/journals/10.1146/annurev-economics-071813-104217
Loading
Experimental and Quasi-Experimental Analysis of Peer Effects: Two Steps Forward?
Annual Review of Economics 6, 253 (2014); https://doi.org/10.1146/annurev-economics-071813-104217
/content/journals/10.1146/annurev-economics-071813-104217
/content/journals/10.1146/annurev-economics-071813-104217
Loading

Data & Media loading...

  • Article Type: Review Article

Most Cited Most Cited RSS feed

This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error