Scandinavian Working Papers in Economics

Working Paper Series,
Research Institute of Industrial Economics

No 645: Peer Effects and Social Networks in Education and Crime

Antoni Calvó-Armengol , Eleonora Patacchini and Yves Zenou ()
Additional contact information
Antoni Calvó-Armengol: ICREA and Universitat Autònoma de Barcelona, Postal: Department of Economics and Economic History, Edifici B, 08193 Bellaterra (Barcelona), Spain
Eleonora Patacchini: Università di Roma "La Sapienza", Postal: Facoltà di Scienze Statistiche, Dipartimento di Contabilità Nazionale e Analisi dei Processi Sociali, P. le Aldo Moro, 5, 00185 Rome, Italy
Yves Zenou: The Research Institute of Industrial Economics, Postal: P.O. Box 55665, SE-102 15 Stockholm, Sweden

Abstract: 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 to 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 Bonocich centrality increases the level of individual delinquency by 45% of one standard deviation and the pupil school performance by 34% of one standard deviation.

Keywords: Centrality Measure; Peer Influence; Network Structure; Delinquency; School Performance

JEL-codes: A14; I21; K42

37 pages, July 5, 2005

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