To secure their membership in a popular group, individuals may contribute more to the group's local public good than they would if group formation were exogenous. Those in the most unpopular group do not have this incentive to contribute to their group. Substantial differences in individual...

While the rules governing the formation of groups engaging in collective action may have significant impact on group size and behavior of members, most experiments on public goods have been conducted with the subjects in fixed groups or of fixed sizes. We study endogenous formation of groups in...

Peer influences on academic outcomes are often studied using GPA as a proxy variable for students' academic effort. We show that this may bias the peer effects when the network includes isolated students. This is because GPA depends on unobserved factors that do not influence isolated and...

Similar to many low- and middle-income nations, a significant proportion of Indian households rely on out-of-pocket (OOP) expenses to fund their healthcare. Such a high OOP may potentially force the most vulnerable members of society into poverty by forcing them to incur catastrophic medical...

There is substantial empirical evidence showing that peer effects matter in many activities. The workhorse model in empirical work on peer effects is the linear-in-means (LIM) model, whereby it is assumed that agents are linearly affected by the mean action of their peers. We develop a new...

We study the effects of disruptive peers within disciplinary schools. When regular instructional schools send disruptive students away to disciplinary schools, removed students are exposed to highly disruptive peers. Using rich administrative data on Texas high school students, we leverage...

Several studies have highlighted the role of group identity in promoting in-group cooperation. This literature, however, has reported contrasting results on the systematic occurrence of in-group cooperation when this entails a personal cost. Empirical evidence suggests that the propensity of...

Higher education policymakers are concerned about the success of first-generation college students. In this study, we investigate one potential factor that may influence outcomes: first-generation students' peers. To mitigate common biases that may arise when estimating peer effects, we leverage...

In 2013, the U.S. Consumer Financial Protection Bureau released a database of consumer complaints filed against banks under its supervision (“CFPB banks”). We find that after the disclosure, rival banks exhibit a greater increase in mortgage approval rates in markets with more intensive...

This paper studies how peers’ financial behaviour affects individuals’ own investment choices. To identify the peer effect, we exploit the composition of the Luxembourg population and use the differ-ences in stock market participation across various immigrant groups to study the effect on...