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Identification of a Rank-dependent Peer Effect Model

Eyo I. Herstad, Myungkou Shin

arXiv 18 Oct 2024 · Econometrics

arXiv:2410.14317 · PDF · DOI · OpenAlex · Extracted main text

Abstract

We develop a model that captures peer effect heterogeneity by modeling the endogenous spillover to be linear in ordered peer outcomes. Unlike the canonical linear-in-means model, our approach accounts for the distribution of peer outcomes as well as the size of peer groups. Under a minimal condition, our model admits a unique equilibrium and is therefore tractable and identified. Simulations show our estimator has good finite sample performance. Finally, we apply our model to educational data from Norway, finding that higher-performing friends disproportionately drive GPA spillovers. Our framework provides new insights into the structure of peer effects beyond aggregate measures.

Citation extraction

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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Yann Bramoullé, Habiba Djebbari \ Bernard Fortin (2009) Identification of peer effects through social networks1.00093100%
2Ragnar Alne, Eyo I. Herstad \ Andreas Myhre (2025) How Socioeconomic and Parental Background Shape Peer Networks and Educational Spillovers0.81142100%
3Changhui Kang (2007) Classroom peer effects and academic achievement: Quasi-randomization evidence from South Korea0.73732100%
4Vincent Boucher, Michelle Rendall, Philip Ushchev \ Yves Zenou (2024) Toward a general theory of peer effects0.58531100%
5Gigi Foster (2006) It's not your peers, and it's not your friends: Some progress toward understanding the educational peer effect mechanism0.51121100%
6Jonathan Guryan, Kory Kroft \ Matthew J Notowidigdo (2009) Peer effects in the workplace: Evidence from random groupings in professional golf tournaments0.51121100%
7Li Han \ Tao Li (2009) The gender difference of peer influence in higher education0.51121100%
8Yann Bramoullé, Habiba Djebbari \ Bernard Fortin (2020) Peer effects in networks: A survey0.51121100%
9Aureo De Paula (2013) Econometric analysis of games with multiple equilibria0.51121100%
10Charles F Manski (1993) Identification of endogenous social effects: The reflection problem0.51121100%

Showing the top 10 of 25 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1Quantile Peer Effect Models10pt10pt For comments and suggestions, I am grateful to Yann Bramoullé, Vincent Boucher, Firmin Doko Tchatoka, Mathieu Lambotte, and Marie Aurélie Lapierre. This research uses data from the National Longitudinal Study of Adolescent to Adult Health (Add Health), a program that is directed by Kathleen Mullan Harris and designed by J. Richard Udry, Peter S. Bearman, and Kathleen Mullan Harris at the University of North Carolina at Chapel Hill, and funded by Grant P01-HD31921 from the Eunice Kennedy Shriver National Institute of Child Health and Human Development, with cooperative funding from 23 other US federal agencies and foundations. Special acknowledgment is given to Ronald R. Rindfuss and Barbara Entwisle for assistance in the original design. Information on how to obtain Add Health data files is available on the Add Health website (www.cpc.unc.edu/addhealth). No direct support was received from Grant P01-HD31921 for this research. An R package, including all replication codes, is available at: https://github.com/ahoundetoungan/QuantilePeer0.58531
2Heterogeneity in peer effects for binary outcomes0.40511