Differentiated social interactions in the US schooling race gap

I show how differences in the schooling achievement of white and nonwhite teenagers across US cities can be explained in a context where teenagers have different values of their interactions with individuals belonging to their same racial group versus individuals belonging to other racial groups. Following an approach of differences in conditional variances, I establish the conditions for the identification of the coefficient of differences in social interactions. Using the US census data, I find that teenagers within a city place more value on the decisions of teenagers in their same racial group than to teenagers in different racial groups.