Peer Effects Heterogeneity and Social Networks in Education

Livia Shkoza, Selver Uysal and Winfried Pohlmeier
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Livia Shkoza: University of Konstanz, GSDS
Winfried Pohlmeier: University of Konstanz, CASCB, ICEA

No 423, Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition

Abstract: This study focuses on the role of heterogeneity in network peer effects by accounting for network-specific factors and different driving mechanisms of peer behavior. We propose a novel Multivariate Instrumental Variable (MVIV) estimator which is consistent for a large number of networks keeping the individual network size bounded. We apply this approach to estimate peer effects on school achievement exploiting the network structure of friendships within classrooms. The empirical evidence presented is based on a unique network dataset from German upper secondary schools. We show that accounting for heterogeneity is not only crucial from a statistical perspective, but also yields new structural insights into how class size and gender composition affect school achievement through peer behavior.

Keywords: network heterogeneity; peer effects; multivariate instrumental variables; minimum distance estimation; school achievement (search for similar items in EconPapers)
JEL-codes: C30 C36 D85 I21 L14 (search for similar items in EconPapers)
Date: 2023-09-06
New Economics Papers: this item is included in nep-ecm, nep-net, nep-soc and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:rco:dpaper:423

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