Peer correlations in income: Evidence from a Guanxi network in rural China

Hang Fang, Qianheng Chen, Michael S. Delgado and Qinying He

Economics Letters, 2023, vol. 222, issue C

Abstract: We investigate peer correlations in income using a novel panel of data from a village in China. We construct a complete and heterogeneous social connections (guanxi) network that includes all households, and use spatial-network econometric models to estimate peer correlations. The results provide unique empirical evidence for the existence of a peer correlation in income, even after netting out influences of family characteristics, contextual effects, and various unobservable factors. We identify peer effects in land and labor allocations as the drivers of peer correlations in income.

Keywords: Peer correlations; Income; Guanxi network; China (search for similar items in EconPapers)
JEL-codes: D91 Z13 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:222:y:2023:i:c:s0165176522004335

DOI: 10.1016/j.econlet.2022.110959

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