Marco Battaglini, Carlos Díaz, Eleonora Patacchini, 29 January 2017

Peers and role models play a key role in the choices young people make. This column discusses research suggesting that students who are part of a social circle have more self-control than those who are alone, and the larger this social circle, the greater the self-control. However, having peers who are too similar can be detrimental to self-control.

Giacomo De Giorgi, Anders Frederiksen, Luigi Pistaferri, 17 September 2016

Household consumption can be influenced by the consumption behaviour of peers. This column examines why this is the case, and considers some policy implications. The tendency for individuals to under-save (or over-borrow) in an attempt to ‘keep up with the Joneses’ appears to be driven by the average consumption of their peers, rather than by the consumption of conspicuous items. If tax policy fails to consider these peer effects, it risks wrongly estimating the effects of tax reforms that target certain groups.

Stephen Billings , David Deming, Stephen Ross, 11 July 2016

The propensity for youths to commit crime has long been associated with where they live. This column looks at how the school they attend can shape this relationship. Exploiting changes to school catchment areas in a US school district, it shows that concentrations of students with similar characteristics and from similar neighbourhoods at the same school increase arrest rates, if these potential peers live close to each other. Moreover, youths who live near each other and are in the same school and grade are more likely to commit crimes together. Policies to decrease segregation in schools could thus be effective in reducing crime.

Scott Carrell, Mark Hoekstra, Elira Kuka, 25 April 2016

Bad behaviour by peers is well-known to worsen educational outcomes in the short run. This column investigates the long-run effects of peers from families marked by domestic violence. Individual-level US data linking middle and high school test scores, college enrolment, and earnings at ages 24–28 show that students exposed to more disruptive peers experience worse adult outcomes. Policies that mitigate exposure to disruptive peers could pay high dividends.

Matthew Lindquist, Jan Sauermann, Yves Zenou, 10 December 2015

There is growing evidence that worker productivity is contagious. This column examines the impact of co-worker networks on productivity using tools from network economics. There are indeed strong network effects in worker productivity, with increases in the productivity of an individual’s co-worker network leading to an increase in the individual’s productivity. Also, exposure to trained workers increases the productivity of non-trained workers. The findings have implications for the optimal structure of co-worker networks within firms.

Jan van Ours, Ali Palali, 16 October 2015

A major aim of cigarette taxes and tobacco control policies is to encourage smokers to quit. It is therefore important to understand the dynamics of quitting decisions in two-smoker couples. This column uses Dutch data to examine whether spousal peer effects exist for smoking cessation decisions. After controlling for the fact that couples are more likely to be similar to begin with, no evidence is found of one partner’s decision to quit affecting their spouse’s decision.

Trevon Logan, John Parman, 09 March 2015

Racial disparities in socioeconomic conditions remain a major policy issue throughout the world. This column applies a new neighbour-based measure of residential segregation to US census data from 1880 and 1940. The authors find that existing measures understate the extent of segregation, and that segregation increased in rural as well as urban areas. The dramatic decline in opposite-race neighbours during the 20th century may help to explain the persistence of racial inequality in the US.

Yves Zenou, 08 January 2015

Targeting key players in a network can have important effects due to multipliers arising from peer effects. This column argues that this is particularly true for crime –the success in reducing crime in Chicago was due to the targeting of 400 key players rather than spending resources on more general targets. Key-player policies in crime, education, R&D networks, financial networks, and diffusion of microfinance outperform other policies such as targeting the most active agents in a network.

Nicola Bianchi, 29 December 2014

Governments sometimes promote reforms that increase access to education for a large share of the population. These reforms may lower the returns to education by altering returns to skills, education quality, and peer effects. This column examines a 1961 Italian reform that increased enrolment in university STEM majors among students who had previously been denied access. The reform ultimately failed to raise their incomes.

Jason Fletcher, Stephen Ross, 03 November 2013

There is a large and growing literature on peer effects, but much less is known about the role of friendships and social relationships in student outcomes. The best evidence on the mechanisms behind aggregate peer effects suggests an important role for discipline and disruption. Very recent research suggests that friends can also have a substantial effect on student outcomes, and in many cases the effect of friends appears to be independent of aggregate peer effects.

Clément Bosquet, Pierre-Philippe Combes, 21 June 2013

Every academic has an opinion about what makes a good department. This column brings evidence from French economics departments. It suggests that larger departments are associated with slightly more but no better publications per academic. And while diversity in terms of researcher quality lowers average publication quality, diversity in research topics increases it.

Xiaodong Liu, Eleonora Patacchini , Yves Zenou, 09 April 2013

Economists know that your peers’ behaviour affects your economic and social outcomes. But what mechanisms are at work here? This column highlights the two major approaches that hope to explain ‘peer effects’: either people don’t want to deviate from social norms; or they are affected by a ‘social multiplier’, the influence of the sum of their peers’ behaviour. Using detailed data on friendship networks, evidence suggests that there are strong social-multiplier effects in criminal behaviour whereas, for education, social norms matter the most. A detailed understanding of peer effects will undoubtedly help policymakers better tackle social problems.

Josh Lerner, 22 August 2008

Where do clusters of entrepreneurs come from? Josh Lerner of Harvard Business School talks to Romesh Vaitilingam about his research on peer effects and early-career entrepreneurship, which analyses data on HBS alumni. The interview was recorded at the American Economic Association meetings in New Orleans in January 2008.

Richard Baldwin, 31 May 2008

Smoking bans are sweeping Europe. New research suggests that these bans reduce smoking amongst those directly affected and their families and peers, creating what could be called a “public health multiplier”.

Eric Gould, Todd Kaplan, 05 November 2007

The importance of environment and how workers affect the productivity of co-workers through learning valuable skills and work habits is often stressed, but whether employees sometimes learn unethical practices from their peers in order to boost productivity is less well documented. The authors of CEPR DP6550 find that once a worker adopts questionable methods - which seem to be effective, competitive pressures may lead others to follow in order to get ahead, or perhaps just to stay even with other workers who are adopting similar techniques.

Eric Gould, Eyal Winter, 15 October 2007

How does the effort shown by one worker affect the efforts of fellow workers within the same firm? While frequently proposed behavioural explanations would lead us to expect that one worker trying harder would encourage others to also try harder (and vice versa), irrespective of the roles of the workers concerned, the authors of CEPR DP6527 show how the change in effort put in by one worker can have either a positive or negative impact on co-workers based purely on income-maximizing considerations.

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