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Household finances are confidential and discussions are limited to a subset of peers. We collect novel representative survey data to examine separately whether interactions with inner and outer social circles influence return perceptions, expectations, and exposure to a widely known financial instrument in a developed economy with multiple information sources. We find that a respondent's connectedness, proxied by perceived prevalence of information or participation in the small financial circle, improves expectation accuracy indirectly, through boosting accuracy of perceived past returns; and influences stock participation and exposure not only by influencing expectations, but also directly.

Chinese government promotes the synergy of regional innovation and established several innovation reform zones as innovative investment is critical for the development of a firm and economic growth. An important related question we address in this paper is how peers influence firms’ innovative investment using Chinese listed companies from 2013 to 2017. We find that firms’ innovative investment is significantly influenced by their peers, and when the market competitiveness of a firm is weaker, its innovative investment is more greatly affected by its peers. Firms are highly sensitive to their similar peers. The peer effects in innovative zones are stronger than those from outside of the zones. We discuss the policy implications of the findings.

The market for plug-in electric vehicles (PEVs) that primarily include battery electric vehicles (BEVs) and plug-in hybrid vehicles (PHEVs) has been rapidly growing in California for the past few years. Given the targets for PEV penetration in the state, it is important to have a better understanding of the pattern of technology diffusion and the factors that are driving the process. Using spatial analysis and Poisson count models, the researchers identify the importance of a neighborhood effect (at home locations) and workplace effect (at commute destinations) in supporting the diffusion of PEV technology in California. In the case of new BEV sales, they found that exposure to one additional BEV or PHEV within a 1-mile radius of a block group centroid is associated with a 0.2% increase in BEV sales in the block group. Interestingly, for new PHEV sales, the neighborhood effect of BEV sales is negative, suggesting that enhanced exposure to this type of technology (which is differentiated in distinctive ways from PHEVs) may impact new PHEV sales through a substitution effect. Specifically, higher BEV concentration in an area can have an overall negative effect on new PHEV sales. While the neighborhood effect at residential locations is important, the workplace effect also has a notably important effect on new PEV sales. Both effects work in combination with socioeconomic, demographic, policy, and built environment factors in encouraging PEV adoption. These results suggest that policymakers should consider targeted programs and investments that can boost the impact of neighborhood and peer effects on PEV salesView the NCST Project Webpage

Designing interventions aimed at fostering peer effects in schools requires knowledge of how individuals endogenously sort into groups. We propose a theoretical model where agents form groups endogenously and their outcomes are affected accordingly. Using a popular payoff structure, we show that equilibrium outcomes are consistent with the linear-in-means model used to empirically study peer effects, and we characterize the set of stable networks. Further analytical results show that the model can explain the empirical results of Carrell et al. (2013). In particular, segregation in the classroom harms the transmission of peer effects that would benefit the lower achieving students. The presence of weak ties could counteract this outcome.

This study examines the gendered effects of early and sustained exposure to high-performing peers on female educational trajectories. Exploiting random allocation to classrooms within middle schools, we measure the effect of male and female high performers on girls’ high school placement outcomes. We examine the effects that peers have on two distinct outcomes: academic performance and preferences for schools with more-selective admission standards. We focus on the effects of peers along the distribution of baseline academic performance. Exposure to high-performing peers of either sex reduces the degree to which high-achieving girls seek placement in more-selective schools. High-achieving boys have particularly strong, negative effects on high-performing girls’ admission scores and preferences for more-selective and more-academic schools. By contrast, high-achieving girls improve low-performing girls’ placement outcomes, but exclusively through a positive effect on exam scores.

Using panel data on IT investment choices and outcomes, we perform the first empirical test of the existence of peer effects and social learning in Jordanian banks’ IT investment decisions. We fit a linear in means model of social interaction and find evidence of peer effects in banks’ choice of IT investment, consistent with the presence of contextual or endogenous effects. Further, a bank’s IT investment increases significantly with other banks’ lagged IT investments, consistent with the presence of social learning. However, a bank’s IT investment does not respond to other banks’ lagged profitability, consistent with the presence of the IT productivity paradox.

We conduct an artefactual field experiment in endogenously formed groups in rural Malawi to investigate social influence in risk taking. Treatments vary whether individuals observe the behavior of a formally elected leader, an external leader, or a random peer. Results show social influence in risk taking with differential influence by leader type. The decisions made by peers are most influential, followed by those made by formal leaders, and then external leaders. Exploratory analysis suggests that participants follow peers because they extract information from their choices and share risks with them; while other forms of social utility are gained from following the example of leaders.

The German reunification experiment provided sudden access to previously unavailable financial products, supported by knowledgeable practitioners. This setting offers new perspectives on participation, inertia, and product diffusion. Controlling for characteristics, East Germans experienced a jump in securities participation to a level comparable to West Germans’ participation immediately following reunification, and to an even higher level for consumer debt, while exhibiting inertia in previously accessible products. They showed no signs of subsequent retreat. Lower financial resources are the most important characteristic explaining lower East German participation in all asset classes, while expectations and peer effects drive the higher East German debt participation.

Using a nationally representative sample of 3- and 4-year-old Spanish-speaking dual language learners (DLLs) attending Head Start (N = 654), this study examined whether mean levels of and variability in peers’ English receptive vocabulary skills were associated with DLLs’ English and Spanish receptive vocabulary skills in the spring. In addition, I tested whether these associations differed depending on the proportion of DLLs in the class. Results showed that DLLs had better English receptive vocabulary growth, but weaker Spanish receptive vocabulary growth when their classmates had higher English receptive vocabulary skills. Variability in peers’ English receptive vocabulary skills was not significantly associated with vocabulary growth in English or Spanish. These patterns did not depend on the proportion of DLLs in the class, pointing to the utility of understanding peer effects in terms of classmates’ skills and not only their characteristics. Findings demonstrate the importance of classmates’ English vocabulary skills for English vocabulary development. However, additional supports are needed to maintain DLLs’ vocabulary development in Spanish.

Team branding plays a key role in attracting corporate sponsorship for the multi-billion dollar business of college sports. In this paper, we study peer effects in the dynamic brand revenue evolution of major college sports teams that play in the same National Collegiate Athletic Association conferences. To examine the peer effects in each conference, we propose a new dynamic model that can identify conference-specific peer effects while capturing the dynamic evolution of brand revenue. Our model estimation results reveal significant positive peer effects in the six conferences — ACC, Big 12, Big East, Big Ten, SEC, and Pac-12 — where the brand revenue of teams benefit from other teams in the same conference. Our modeling approach also sheds light on the effect of a conference switch on a team's brand revenue by showing the difference between predicted brand revenue with a switch and the predicted brand revenue without a switch.

This paper discusses the formation of peers in an anonymous higher education setting using a unique data set of industrial engineering students. For identification, we exploit the random assignment of students into groups and student performance before students met. We compare two different settings for potential peer formation: a voluntary freshman orientation week organized by the students’ union and a mandatory group work course. It is only in the case of the group work course that we report persistent impacts on subsequent academic achievement. In line with our theoretical reasoning, peer effects exist between groups of two students who were already similar before.

Research shows that many factors affect restaurant patrons’ tipping behavior. In this study from Norway, we use an experimental approach to examine a new factor: the influence of peers. We show that the tipping behavior of dining companions – i.e. peers – affects restaurant patrons’ likelihood of providing a tip as well as their provided tip amounts. We interpret this as a form of social pressure enforcing a weak Norwegian tipping norm. The size of the bill and perceived service quality also affect tipping behavior and moderate the peer effects (i.e. effect heterogeneity). We conclude that peer effects might play an important role in future tipping research focusing on the determinants of individual tipping practices.

This paper assesses peer group influence on academic performance of primary school students in Latin America and the Caribbean. Based on TERCE data set, we investigate peer effects in mathematics, language and sciences tests outcomes among sixth grade students. We apply a social interaction model which allows to identify endogenous and exogenous peer effects while controlling for group-level fixed effects. We explore some heterogeneities related to the school type (private, public or rural). The estimates suggest the existence of endogenous peer effects but their magnitude and significance depend on subject and school type.

This paper investigates peer effects among high-skilled individuals in competitive environments with high-stakes incentives. I use data from the Swimming World Championships and study whether having a teammate in the competing group affects individual performance. The identification challenge lies in that the competing group’s composition is endogenous to individual performance. I apply a regression discontinuity design by comparing finalists’ performance when their teammate barely qualified or not qualified for the same finals. Female athletes accompanied by a teammate finished with less time and performed 0.8 to 1.18 ranks better in the finals. Male athletes’ performance is unaffected. The potential mechanisms of enhanced intra-team competition and mitigated psychosocial pressure are discussed and are in line with literature on gender differences.

We propose a novel empirical strategy to distinguish two sources of peer effects in risky choices: (i) assortative matching in the formation of the peer relationship, and (ii) social interaction effects arising in the choice situation. We combine network information on existing peer relationships with controlled randomised exposure to social interaction conditions. We apply this strategy in a field experiment on risky decision making among adolescents between ages 13 and 15. School classes were randomly allocated to two social interaction treatments. Students were allowed to discuss their choices with a natural peer – either a friend or a randomly selected classmate – before individually making choices in an incentivised lottery task. In the control group, adolescents made choices without being able to discuss them with a peer. In a dyadic analysis, we find that friends and classmates are matched on socio-demographic characteristics but are not assortatively matched on risk preferences. In contrast, social interaction strongly increases the similarity of teenagers’ risky choices. A large fraction of peers align their choices perfectly.

An increasing number of young children nationally participate in preschool education, yet very little is known about the influence of peers' behavioral regulation, such as maintaining focus on a task in the face of distractions and inhibiting a dominant response (attentionimpulse control), and remembering instructions (engagement) on children's motor-cognitive readiness skills (i.e., peer effects). This study determined whether peer effects are present in this earliest sector of schooling. Research has shown that a child's own behavioral regulation is associated with his or her academic outcomes. However, not much is known about how children are affected by classmates with poor behavioural regulation. This study begins to fill the gaps in our understanding of preschool peer effects in the form of peers' behavioral regulation relative to children's motor-cognitive readiness skills. It addresses two research questions: (1) Is the average level and amount of variation of peers' behavioral regulation skills (i.e., engagement and attentionimpulse control) in a classroom associated with growth in children's motor-cognitive readiness outcomes in preschool (motor, content knowledge, and language)? (2) Do these associations differ for children with high and low initial levels of behavioral regulation? The analytic sample is drawn from a cluster (school) randomized controlled trial testing a family-centered, school-based intervention (N=1050 children in 99 classrooms drawn from 10 high-poverty schools). Results indicated that classroom-level peer engagement skills made a unique contribution to children's growth of motor skills during the preschool academic year. Furthermore, children with higher engagement skills at the beginning of the preschool year had higher motor-cognitive readiness skills (motor, content knowledge, and language) at the end of the year when they were in classrooms with peers with high engagement skills. This study extends previous work with older children and indicates that after adjusting for an assortment of demographic, preschool program-related factors, and motor-cognitive readiness at entry into preschool, peers' engagement skills may make a unique contribution to children’s motor-cognitive readiness skills during the preschool academic year.

Peer-effects research finds that preschool children’s language growth is associated with classmates’ skills and that children with disabilities especially benefit from classmates with higher skills. The current study estimates the amount of peer language resources individual children access through their classroom-based peer social interactions, which represents an aggregation of peers’ language skills weighted by teacher-perceived interaction intensities between dyads. Participants were 448 children (57% boys, 40% with disabilities, Mage = 52.29 months) from 58 inclusive preschool classrooms. Results showed a significant variation of peer language resources within classrooms and indicated that children with disabilities had significantly fewer peer language resources, although peer language resources showed a stronger association with their language growth than that of typically developing children.

Do the people around us influence our personality? To answer this question, we conduct an experiment with 543 university students who we randomly assign to study groups. Our results show that students become more similar to their peers along several dimensions. Students with more competitive peers become more competitive, students with more open-minded peers become more open-minded, and students with more conscientious peers become more conscientious. We see no significant effects of peers'extraversion, agreeableness, or neuroticism. To explain these results, we propose a simple model of personality development under the influence of peers. Consistent with the model's prediction, personality spillovers are concentrated in traits predictive of performance. Students adopt personality traits that are productive in the university context from their peers. Our findings highlight that socialization with peers can influence personality development.

Little is known about the role of active peer effects (interpersonal contact) compared to passive peer effects (noticing or seeing) regarding residential photovoltaic (PV) diffusion. Recent literature suggests that peer effects are determined by the perceived credibility of one's active peer connections regarding PV and passive peer effects. Utilising data from a survey of German house owners who either own a PV or indicate purchase intention (N = 1,165), this paper explores the underlying mechanisms of active peer effects during different stages of PV adoption decision-making. Our findings suggest that the perceived credibility of peers on PV related issues is positively associated with the reported number of adopters in the decision-maker's peer group (passive peer effect) and also with the progress in the PV adoption decision process. Furthermore, we find a relationship between the perceived credibility of peers regarding PV and the reported influence strength of peer interactions throughout the decision-making processes of German householders, suggesting that subjective evaluations of peers play a role in active peer effects. Finally, we observe an association between the rate of self-initiated peer interactions about PV for respondents with a higher reported number of peers that have adopted PV, suggesting that passive effects (knowing peer PV adopters) play a role in initiating active peer interactions. These results are significant for all sub-groups, regardless of the decision progress. From a policy-making perspective, “bottom-up” efforts such as peer consultation and community-led outreach should be promoted in Germany to empower potential adopters.

This paper uses a novel experimental design to study the contagion of pro- and anti-social behavior and the role of social proximity among peers. Across systematic variations thereof, we find that anti-social behavior is generally more contagious than pro-social behavior. Surprisingly, we also find that social proximity amplifies the contagion of anti-social behavior more strongly than the contagion of pro-social behavior. Anti-social individuals are also most susceptible to the behavioral contagion of other anti-social peers. These findings paired with the methodological contribution inform the design of effective norm-based policy interventions directed at facilitating pro-social behavior and reducing anti-social behavior in social and economic environments.

We study the effect of random dormitory assignment in a tertiary level educational institution in India on students’ subsequent academic achievements. We examine the importance of interactions between the characteristics of the student and his peers for educational outcomes, including non-linear peer-effects and the importance of different socio-economic and geographical backgrounds. We find that peer ability effects are around one-third the size of the effects of one's own ability, and students from non-urban and non-English backgrounds do particularly better when assigned to higher-ability peers. We find that all groups of ability students gain from being matched to high-ability peers, but that this gain is highest for students who are themselves of higher-ability. Our results suggest peer effects are stronger in the first year in dorm. In terms of mechanisms, we find no evidence for effects of peers via mental health, life satisfaction, or risk attitudes. We observe that a roommate's study times is highly correlated with a student's own study times, but we see only a weak positive association between study habits and grades.

Perhaps the two best known critiques of the “law school mismatch” hypothesis are one jointly authored by Ian Ayres and Richard Brooks, and another by Daniel Ho. This article attempts to both reproduce and replicate these studies, and finds neither holds up well. Ayres and Brooks make outright errors in their analysis which, when corrected, reverse their results. All three authors make indefensible methodological choices that, when modified in logical ways, either support the law school mismatch hypothesis or leave it untouched.

Employing a unique data from a county in rural China, we use the regression-discontinuity design to study the causal effects of elite school and magnet class enrollment. Our data contains two admissive processes, allowing us to separately examine elite school and magnet class effects on two groups of students with different abilities. Results show that enrollment in elite schools has small and insignificant effect on borderline student scores in the college entrance examination, whereas studying at a magnet class can significantly boast borderline student CEE score by 0.435 standard deviations. We provide suggestive evidence that teacher effect is roughly 40% of the magnitude of the peer effects associated with the score gain in magnet classes. We also find magnet class experience can improve the probability of entering high-quality academic universities. By comparing the effects of two cutoffs with different student abilities, our findings support the claim that the effect of elite school/magnet class enrollment depends on student abilities.

International audience; We investigate whether peer effects at work differ by gender and whether gender differences in peer effects -if any- depend on work organization. We develop a social network model with gender heterogeneity that we test in a real-effort laboratory experiment. We compare sequential networks in which information flows from peers to the worker and simultaneous networks where it disseminates bi-directionally. We identify strong gender differences as females disregard their peers’ performance in simultaneous networks, while males are influenced by peers in both networks. Females may perceive the environment in simultaneous networks as being more competitive than in sequential networks.

This paper examines peer effects on the academic performance of rural migrant students at both the class level and the individual level. The dataset is from a survey of more than 3000 students from all of the 87 migrant schools in Shanghai and Suzhou, China. The two-stage least squares method with an instrumental variable is employed to control for the endogeneity of peer performance variables. We found that peer effects exist among the migrant students at both class and individual levels. A one-point increase in the average of standardized math grade (SMG) of his/her classmates is associated with an increase of 0.5 points in the SMG of an individual (1.01 standard deviation). A one-point increase in a learning companion's SMG can result in an increase of 0.046 points in the student's SMG. The findings reveal that private migrant schools can improve rural migrant students' academic performance by optimizing students' class allocation and building study groups, providing an additional boost to the input-output efficiency of the human-capital education of the children of migrant workers in China, but the effects of these measures are limited.

I show dividend policies have peer effects. My estimates indicate that firms speed up the time taken to make a dividend change by about 1.5 quarters and increase payments by 16% in response to peer changes. The peer effects matter in increases but not decreases. In contrast to dividends, repurchases show no peer effects. In addition, announcement returns indicate that investors partially anticipate the consequences of peer effects. Overall, peer interdependencies account for 12% of total dividend payments.

Using a semiparametric smooth-coefficient partial adjustment model, this study finds evidence for asymmetric peer effects on capital structure adjustment speeds between overlevered and underlevered firms. Overlevered firms’ adjustment speeds and peer firm shocks have a U-shaped relationship, while underlevered firms’ adjustment speeds monotonically increase with peer firm shocks.

We introduce a novel methodology to study peer effects. Using virtual reality technology, we create a naturalistic work setting in an immersive virtual environment where we embed a computer-generated virtual human as the co-worker of a human subject, both performing a sorting task at a conveyor belt. In our setup, subjects observe the virtual peer, while the virtual human is not observing them. In two treatments, human subjects observe either a low productive or a highly productive virtual peer. We find that human subjects rate their presence feeling of “being there” in the immersive virtual environment as natural. Subjects also recognize that virtual peers in our two treatments showed different productivities. We do not find a general treatment effect on productivity. However, we find that competitive subjects display higher performance when they are in the presence of a highly productive peer - compared to when they observe a low productive peer. We use tracking data to learn about the subjects’ body movements. Analyzing hand and head data, we show that competitive subjects are more careful in the sorting task than non-competitive subjects. We also discuss some VR related methodological issues.

Smart city is a solution for urban planning. The urban population would grow to 6.4 billion by 2050. Smart city is an efficient planning method for future cities. Smart city uses data and technology to improve citizen’s lives and business. Smart city leaders are playing an insightful role in guiding other smart city followers. This research uses the peer effects concept from social science to investigate the relationship between smart city and its peers. This research focuses on the overall smart city peer effects. Also, based on the smart city development levels, three groups (High, medium, and low level) are studied. This research applies an ARMAX model to identify peer effects. The results show the overall and medium level peer effects exist.

This paper analyzes whether internal migrant children have negative peer effects on students’ academic achievements and to explore the mechanisms of these effects, if present. We firstly divided the migrant students into different groups according to their migrant experience. We then examined peer effects of different groups of migrant children, and the effects in differently ranked schools were particularly explored. It is found that rural-urban migrant children had negative peer effects, particularly in low- and middle-ranked schools, while the urban-urban migrant children had no negative peer effects. Endogenous and correlated effects are found as the mechanism of these peer effects.

Using Norwegian registry data, I examine the effect that low-achieving pupils have on their peers in the inclusive Norwegian compulsory education. I exploit the fact that pupils in Norway have to change school when starting lower secondary, and that national tests are conducted in the same subjects, both before and after this change. I focus on the exposure to at least one low-achieving pupil in a fixed effect approach. My results suggest that low-achieving pupils do not have any effect on their peers, and are even consistent when dividing pupils into different groups based on subject, gender, socioeconomic background and pupils’ own position in the achievement distribution.

This paper analyzes the interactions between peers and parents in the development of adolescent's cognitive skills, proxied by the academic performance of adolescents, and the predisposition to risky behavior, proxied by the frecuency of alcohol consumption. We estimate a technology of skill formation that identifies peer effects on the basis of quasi-random assignment of students across classes, time varying data, and the use of instrumental variables. We find that both peer and parental socialization efforts have a positive influence over adolescents’ academic skills, and that these effects are complementary: as parents invest more, peers amplify their effects. Our results suggest that peer effects are heterogenous (boys, popular students and high achievers are more likely to be influenced by peers academic abilities). On the other hand, we do not find robuts evidence of peer effects on the frecuency of alcohol consumption. We do find, however, that parental investment decreases alcohol consumption.

This paper investigates direct and spillover effects of a social information campaign aimed at encouraging residential water savings in Colombia. The campaign was organized as a randomized field experiment, consisting of monthly delivery of consumption reports, including normative messages, for one year. Results indicate that social information and appeals to norm-based behavior reduce water use by up to 6.8% in households directly targeted by the campaign. In addition, we find evidence of spillover effects: households that were not targeted by the campaign reduced water use by 5.8% in the first six months following the intervention.

We study peer effects in absenteeism among workplace colleagues. Gatekeeping is an essential task in many insurance systems. In this study we exploit exogenous shifts of general practitioners (GPs) occurring when physicians quit or retire. We find that these shifts induce changes in absenteeism for affected workers. By utilizing high-quality Norwegian matched employer-employee data with detailed individual information on certified sick leave during the period 2003–2012, we can study how the transfer of workers between GPs affects co-workers’ absenteeism. We identify strong causal positive peer effects in absenteeism: a one day change in focal worker sickness absence transfers to a 0.41 day shift in peer absence. Spillovers from gatekeeping – Peer effects in absenteeism

Understanding how policies can be used to induce technological change, specifically in the area of renewable energy, is crucial for reaching environmental goals. This paper examines the impact of subsidies from the California Solar Initiative (CSI) on non-residential adoption of solar panels. We find evidence that firms do respond to higher solar subsides by increasing their intensity of solar energy. A 10% increase in the subsidy amount leads to an increase in solar capacity by between 1.36% and 2.55%. In addition, although peer effects seem to play an important role in solar adoption decisions, we do not find evidence of peer effects in the intensity of adoption. Both of these findings add a unique perspective to the growing literature on solar energy. This study is also of interest to policy makers who must understand the benefits and costs associated with higher subsidies for inducing technology adoption.

We use firm-level data from Hungary to estimate knowledge spillovers in importing through fine spatial and managerial networks. By identifying from variation in peers' import experience across source countries, by comparing the spillover from neighboring buildings with a cross-street placebo, and by exploiting plausibly exogenous firm moves, we obtain credible estimates and establish three results. (1) There are significant knowledge spillovers in both spatial and managerial networks. Having a peer which has imported from a particular country more than doubles the probability of starting to import from that country, but the effect quickly decays with distance. (2) Spillovers are heterogeneous: they are stronger when firms or peers are larger or more productive, and exhibit complementarities in firm and peer productivity. (3) The model-implied social multiplier is highly skewed, implying that targeting an import-encouragement policy to firms with many and productive neighbors can make it 26% more effective. These results highlight the benefit of firm clusters in facilitating the diffusion of business practices.

We use granular high-frequency data to precisely estimate the effect of COVID demand shocks, bank branches, PPP, and neighborhood peers within 200 yards of retail pharmacies. Neighborhood banks softened the immediate shock for independent pharmacies, but the effect is small. PPP has a larger economic effect, significantly driven by peer effects. If neighborhood stores obtain PPP, whether locally or from out-of-state intermediaries, the store's probability of PPP uptake increases. The COVID shock has accelerated the decline of independent pharmacies, increasing the HHI in local markets by an economically significant 8%, which neither the PPP nor access to local banks prevents.

We provide first empirical evidence that consumer peer effects matter for banks' deposit demand. Using a novel measure that depicts for each county how exposed peers are to a specific bank in a given year, we tightly identify the causal effect of peer exposure on deposit demand through a fixed effects identification strategy. We address key empirical challenges such as time-invariant homophily. We find that a one percent increase in a bank's peer exposure leads to a 0.05 percent increase in deposit market share. This effect has become stronger over time with the rise of the internet and social media, which facilitate cross-county communication. Peer exposure is especially relevant for smaller banks and customers that have access to the internet.

This research examines the peer effects on cash holdings in Vietnam, an emerging market, and finds a reverse peer effect on them - that is, a firm’s level of cash holdings negatively relates to those of its peers. We also note the reverse peer effects are stronger for firms facing less competition and with low intangibility. Because the Vietnam market has noticeable lower competition and investment in innovation than in developed economics like the U.S., our evidence lend supports for competition and innovation investment positively driving cash holdings’ peer effects and reconciles inconsistencies in the literature. Our findings also support heterogeneity across countries in peer mimicking behavior and contributes to the cash holdings literature for the Vietnam market.

This study investigates whether a private firm’s decision to go public affects the IPO decisions of its competitors. Using detailed data from the drug development industry, we identify a private firm’s direct competitors at a precise level through a novel approach using similarity in drug development projects based on disease targets. The analysis shows that a private firm is significantly more likely to go public after observing the recent IPO of a direct competitor, and this effect is distinct from “hot” market effects or other common shocks. Furthermore, our effects are centered on firms that operate in more competitive areas. We additionally explore peer effects in private firm funding propensities more broadly, such as through venture capital or being acquired, and find results consistent with a competitive channel.

This paper uses compensation peer groups to measure peer effects in corporate innovation. This approach provides a true peer group and better leader-follower link and thus can mitigate the reflection problem suggested by Manski (1993). We find that the average innovation activity of the compensation peers is a significant and first-order predictor for corporate innovation. Further analyses show that (1) the peer effect is stronger when peer companies experience higher innovation competition and are closer to the median peer company in the peer group, (2) the results are not likely to be attributed to the knowledge spillover mechanism but rather are more consistent with the peer pressure mechanism, and (3) the SEC’s 2006 executive compensation disclosure rules can generate the peer effects. Overall, the results suggest that corporate innovation decisions are responses to innovation activities and, to a lesser extent, the characteristics of the compensation peer groups.

We consider a population of students with heterogeneous characteristics, and examine the dual design problem consisting of (a) allocating students to schools and (b) choosing how to grade students in school, with a view to optimizing students' incentives to work hard. We show that any optimal school design exhibits stratification, and more lenient grading at the top-tier schools than at the bottom-tier schools. Our results highlight a novel trade-off between the size of the pie and its equal division in the context of school design.

This paper investigates whether exposure to academically gifted peers of the same and opposite gender in primary school (grade 5, at age 10) affects later academic achievement (grade 8, at age 13) and high-school track choice. For identification we exploit random allocation of kids across classes within primary schools. We document that, conditional on primary school fixed effects and grade 8 class fixed effects, as well as on baseline achievement, a higher share of same/opposite- gender high-achievers in math in primary school is related, both for boys and girls, to better/worse later math academic achievement in grade 8 and to a higher/lower probability of choosing a scientific high-school track. We argue that these results are consistent with a role model channel.

I test whether economic incentives impact peer effects in public-good settings. I study how a visible and subsidized contribution to a public good (installing solar panels) affects peer contributions to the same good that are neither subsidized nor visible (electing green power). Exploiting spatial variation in the feasibility of installing solar panels, I find that on average panels increase voluntary purchases of green power by neighbors. However, when subsidies to solar are high, solar panels reduce peer contributions. The results support the hypothesis that signals drive peer responses to visible public-good contributions and that economic incentives alter those signals.

We study the interplay between parental and peer socialization in shaping criminal behavior among adolescents. We develop a simple cultural transmission model where parents affect how society influences their children's decisions. The model predicts that parental and peer socialization are substitutes in the development of juvenile crime. We then take the model to the data using information on a representative sample of adolescents in the United States. Using the geographical distances be- tween residential addresses of individuals in the same grade and school to measure peer influences, we find that negative peer effects on juvenile crime are significantly lower for teenagers with engaged mothers. Consistently with the prediction of our model, this evidence reveals an important role of parents in mediating the impact of neighborhoods on youth crime. The influence of parents is especially important for drug trafficking, assault and battery.

We know surprisingly little about the influence of race-blind school admissions on student outcomes. This paper studies a unique reform where a large, urban school district was federally mandated to adopt a race-blind lottery system to fill seats in its oversubscribed magnet schools. The district had previously integrated its schools by conducting separate admissions lotteries for black and non-black students to offset the predominantly black applicant pools. The switch to race-blind lotteries dramatically segregated subsequent magnet school cohorts.I show that race-blind admissions caused the more segregated schools to enroll students with lower average baseline achievement and to employ lower value-added teachers due to sorting. I also find that segregation is further exacerbated by "white flight" as white students transfer out of the district after attending more segregated schools. Ultimately, the mandated segregation decreases student standardized test scores and four-year college attendance. I provide suggestive evidence that the impact of racial segregation is partially mediated by changes to peer baseline achievement.

This study examines the effect of peer-level analyst transitions (i.e., switching between brokerage houses) on associated regular incumbent analysts' forecasting performance. We employ a difference-in-differences research design with analyst fixed effects and compare incumbent analysts of different groups within the same broker and same time periods. We find that incumbents who cover at least one common industry as the transiting analyst (i.e., affected incumbents) issue more accurate and timely forecasts after a transiting analyst arrives than incumbents who cover different industries (i.e., unaffected incumbents). Further, affected incumbents issue less accurate forecasts after a transiting analyst leaves than do unaffected incumbents. We also examine potential mechanisms of knowledge spillover and find some evidence that the effect is more salient when the transiting analyst switches from a larger brokerage house, has greater industry scope, or covers geographically linked firms.

This paper explores peer effects in parental leave uptake between male coworkers in Sweden. Morespecifically, I use the first parental leave quota, introduced in 1995, to estimate the peer effects ...

Neighborhood peer effects have been shown to affect households publicly observable decisions, but how they affect private decisions, like mortgage refinancing, remains unclear. Using precisely geolocated data and a nearest-neighbor research design, we find that households are 7% more likely to refinance if a neighbor within 50 meters has recently refinanced. Consistent with a word-of-mouth mechanism, social influence effects are stronger when neighbors live especially nearby, weaker when owners are non-occupants, and stronger when neighbors and owners are of the same race. Our results suggest an important role for neighborhood peer effects in explaining regional variation in refinancing activity.

The Elderly Employment Stabilization Law, revised in 2006, helped the government increase elderly employment. While there has been much debate on whether the reemployment of elderly workers has substituted for or increased the employment of young workers, little attention has been paid to the potential peer effects of the former group on the latter’s productivity and other outcomes in the workplace. There might be knowledge spillovers from elderly workers to peers (positive peer effects) or the presence of unmotivated elderly workers lowering the morale of their coworkers (negative peer effects). In this paper, we investigate such peer effects from exposure to elderly workers using the employee satisfaction survey of a Japanese firm. We show that, on average, elderly workers do not have significant peer effects on coworkers’ satisfaction. However, the effects are heterogeneous depending on the ability of elderly workers as measured by their wages, and the age and job levels of their peers. Namely, nonmanagerial workers, particularly those in their 50s, are more satisfied and coworkers in their 30s and 40s receive more training when they work with elderly workers. The positive effects are significant when the focal elderly workers come from other units rather than when they stay in the same units implying that the sharing of broad experience might mediate the effect. In contrast, the presence of elderly workers makes first-line managers feel that there is poor communication in the workplace.