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Social Interactions Models with Latent Structures

Zhongjian Lin, Zhentao Shi, Yapeng Zheng

arXiv 6 Feb 2026 · Statistics — Methodology

arXiv:2602.06435 · PDF · DOI · OpenAlex · Extracted main text

Abstract

This paper studies estimation and inference of heterogeneous peer effects featuring group fixed effects and slope heterogeneity under latent structure. We adapt the Classifier-Lasso algorithm to consistently discover latent structures and determine the number of clusters. To solve the incidental parameter problem in the binary choice model with social interactions, we propose a parametric bootstrap method to debias and establish its asymptotic validity. Monte Carlo simulations confirm strong finite sample performance of our methods. In an application to students' risky behaviors, the algorithm detects two latent clusters and finds that peer effects are significant within one of the clusters, demonstrating the practical applicability in uncovering heterogeneous social interactions.

Citation extraction

55
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in-text mentions
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distinct cited
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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
1Lin, Zhongjian and Xu, Haiqing (2017) Estimation of social-influence-dependent peer pressure in a large network game self1.00053100%
2Aguirregabiria, Victor and Mira, Pedro (2007) Sequential estimation of dynamic discrete games0.92843100%
3Lewbel, Arthur and Qu, Xi and Tang, Xun (2023) Social networks with unobserved links0.92843100%
4Lin, Zhongjian and Hu, Yingyao (2024) Binary choice with misclassification and social interactions, with an application to peer effects in attitude self0.92843100%
5Lin, Zhongjian and Tang, Xun and Yu, Ning Neil (2021) Uncovering heterogeneous social effects in binary choices self0.84333100%
6Su, Liangjun and Shi, Zhentao and Phillips, Peter CB (2016) Identifying latent structures in panel data self0.7375340%
7Higgins, Ayden and Jochmans, Koen (2024) Bootstrap Inference for Fixed-Effect Models0.7374350%
8Dhaene, Geert and Jochmans, Koen (2015) Split-panel jackknife estimation of fixed-effect models0.64422100%
9Kasahara, Hiroyuki and Shimotsu, Katsumi (2009) Nonparametric identification of finite mixture models of dynamic discrete choices0.64422100%
10Neyman, Jerzy and Scott, Elizabeth L (1948) Consistent estimates based on partially consistent observations0.64422100%

Showing the top 10 of 55 scored citations.