The Good, the Bad and the Average: Evidence on the Scale and Nature of Ability Peer Effects in Schools

In this paper, we study ability peer effects in secondary schools in England and identify which segments of the peer ability distribution drive the impact of peer quality on students‟ achievements. To do so, we use census data for four cohorts of pupils taking their age-14 national tests, and measure students‟ ability by their prior achievements at age-11. We employ a new identification strategy based on within-pupil regressions that exploit variation in achievements across the three compulsory subjects (English, Mathematics and Science) tested both at age-14 and age-11. We find significant and sizeable negative peer effects arising from bad peers at the very bottom of the ability distribution, but little evidence that average peer quality and very good peers significantly affect pupils‟ academic achievements. However, these results mask some significant heterogeneity along the gender dimension, with girls significantly benefiting from the presence of very academically bright peers, and boys marginally losing out.