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  5. Peer Effects in Human Capital Accumulation
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Peer Effects in Human Capital Accumulation

Paper Session

Sunday, Jan. 3, 2021 10:00 AM - 12:00 PM (EST)

Hosted By: American Economic Association
  • Chair: Steven Durlauf, University of Chicago

Does Peer Motivation Impact Educational Investments? Evidence from DACA

Briana Ballis
,
University of California-Merced

Abstract

Despite the significant influence that peer motivation is likely to have on educational investments during high school, it is difficult to test empirically since exogenous changes in peer motivation are rarely observed. In this paper, I focus on the 2012 introduction of Deferred Action for Childhood Arrivals (DACA) to study a setting in which peer motivation changed sharply for a subset of high school students. DACA significantly increased the returns to schooling for undocumented youth, while leaving the returns for their peers unchanged. I find that DACA induced undocumented youth to invest more in their education, which also had positive spillover effects on ineligible students (those born in the US) who attended high school with high concentrations of DACA-eligible youth.

The Spillover Effects of Pollution: How Exposure to Lead Affects Everyone in the Classroom

Ludovica Gazze
,
University of Chicago
Claudia Persico
,
American University
Sandra Spirovska
,
University of Wisconsin-Madison

Abstract

Evidence shows that lead-exposed children are more disruptive and have lower achievement. However, we know less about how lead-exposed children affect the learning environment of their classroom peers. We estimate these spillover effects using new data on children's blood lead levels (BLLs) matched to all education data in North Carolina. We compare siblings who attend the same school, but whose school-grade cohorts differ in the proportion of children with elevated BLLs. We find that having more lead-exposed peers is associated with lower test scores and graduation rates, increased suspensions and dropping out of school, and a decrease in college intentions.

The Value of a Peer

Ingo Isphording
,
IZA
Ulf Zölitz
,
University of Zurich

Abstract

This paper introduces peer value-added, a new approach to quantify the total contribution of an individual peer to student performance. Peer value-added captures social spillovers irrespective of whether they are generated by observable or unobservable peer characteristics. Using data with repeated random assignment to university sections, we find that students significantly differ in their peer value-added. Peer value-added is a good out-of-sample predictor of performance spillovers in newly assigned student-peer pairs. Yet, students’ own past performance and other observable characteristics are poor predictors of peer value-added. Peer value-added increases after exposure to better peers, and valuable peers are substitutes for low-quality teachers.

It Takes a Village: The Economics of Parenting with Neighborhood and Peer Effects

Francesco Agostinelli
,
University of Pennsylvania
Matthias Doepke
,
Northwestern University
Giuseppe Sorrenty
,
University of Amsterdam
Fabrizio Zilibotti
,
Yale University

Abstract

As children reach adolescence, peer interactions become increasingly central to their development, whereas the direct influence of parents wanes. Nevertheless, parents may continue to exert leverage by shaping their children's peer groups. We study interactions of parenting style and peer effects in a model where children's skill accumulation depends on both parental inputs and peers, and where parents can affect the peer group by restricting who their children can interact with. We estimate the model and show that it can capture empirical patterns regarding the interaction of peer characteristics, parental behavior, and skill accumulation among US high school students. We use the estimated model for policy simulations. We find that interventions (e.g., busing) that move children to a more favorable neighborhood have large effects but lose impact when they are scaled up because parents' equilibrium responses push against successful integration with the new peer group.
Discussant(s)
Stephen Billings
,
University of Colorado Boulder
Eric Chyn
,
Dartmouth College
Karen Ye
,
University of Chicago
Gregorio Caetano
,
University of Georgia
JEL Classifications
  • I0 - General