Discussion paper

DP5244 Peer Effects and Social Networks in Education and Crime

This paper studies whether structural properties of friendship networks affect individual outcomes in education and crime. We first develop a model that shows that, at the Nash equilibrium, the outcome of each individual embedded in a network is proportional to her Bonacich centrality measure. This measure takes into account both direct and indirect friends of each individual but puts less weight on her distant friends. Using a very detailed dataset of adolescent friendship networks, we show that, after controlling for observable individual characteristics and unobservable network specific factors, the individual's position in a network (as measured by her Bonacich centrality) is a key determinant of her level of activity. A standard deviation increase in the Bonacich centrality increases the level of individual delinquency by 45% of one standard deviation and the pupil school performance by 34% of one standard deviation.

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Citation

Zenou, Y, A Calvó-Armengol and E Patacchini (eds) (2005), “DP5244 Peer Effects and Social Networks in Education and Crime”, CEPR Press Discussion Paper No. 5244. https://cepr.org/publications/dp5244