Laura Straeter, Jessica Exton, 23 September 2018

Although money may be a taboo topic amongst friends, one’s social networks can offer help in times of personal financial straits. This column examines people’s willingness to borrow money from or lend to close friends for everyday purchases and finds that friends are much more willing to lend than to ask to borrow, and that this gap between borrower and lender widens as requests are repeated. Ensuring that there is occasion for reciprocation and using technological tools to regulate the peer-to-peer loan may help improve this suboptimal informal lending market.

Yves Zenou, 15 August 2008

Yves Zenou talks to Romesh Vaitilingam about his research on the sources of differences in school performance between students of different races, which uses data on friendship groups among American teenagers. He finds that having a higher percentage of same-race friends has a positive effect on white teenagers’ test scores but a negative effect on black teenagers’ test scores.


CEPR Policy Research