A new identification approach distinguishing effort-affecting preference shocks from other GPA shocks yields peer effect estimates 40% higher than GPA-proxy methods when networks include isolated students, shown in US high school data.
(2011): Peer effects in education: How might they work, how big are they and how much do we know thus far? in Handbook of the Economics of Education, Elsevier, vol
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Identifying Peer Effects in Networks with Unobserved Effort and Isolated Students
A new identification approach distinguishing effort-affecting preference shocks from other GPA shocks yields peer effect estimates 40% higher than GPA-proxy methods when networks include isolated students, shown in US high school data.