It Takes a Village: The Economics of Parenting with Neighborhood and Peer Effects
Abstract
As children reach adolescence, peer interactions become increasingly central to their development, whereas the direct influence of parents wanes. Nevertheless, parents may continue to exert leverage by shaping their children's peer groups. We study interactions of parenting style and peer effects in a model where children's skill accumulation depends on both parental inputs and peers, and where parents can affect the peer group by restricting who their children can interact with. We estimate the model and show that it can capture empirical patterns regarding the interaction of peer characteristics, parental behavior, and skill accumulation among US high school students. We use the estimated model for policy simulations. We find that interventions (e.g., busing) that move children to a more favorable neighborhood have large effects but lose impact when they are scaled up because parents' equilibrium responses push against successful integration with the new peer group.
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Endogenous peer group formation can amplify educational inequality, because homophily bias implies that socio-economic differences across families are reproduced in the peer connections children make in schools and neighborhoods.
“Endogenous peer group formation can amplify educational inequality, because homophily bias (the tendency to associate with peers who are similar to oneself) implies that socio-economic differences across families are reproduced in the peer connections children make in schools and neighborhoods (Agostinelli et al. 2020).”
From Educational Inequality* (2022) · cites this paper as Agostinelli et al. 2020
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- Authors
- Agostinelli, F., Doepke, M., Sorrenti, G., & Zilibotti, F.
- Affiliations
- University of Pennsylvania (US)
- Northwestern University (US)
- University of Zurich (CH)
- Yale University (US)
- Venue
- National Bureau of Economic Research
- Publisher
- National Bureau of Economic Research
- Published
- 2020-04
- OpenAlex
- W3017166378
- Cited by
- 74
- References
- 0
- Citations by year
- 2026: 3 · 2025: 15 · 2024: 16 · 2023: 11 · 2022: 15 · 2021: 8 · 2020: 4 · 2019: 1 · 2016: 1
- Type
- report
- Language
- en
- Open access
- closed
- Locations
- National Bureau of Economic Research (publishedVersion)
- Topics
- Social Sciences › Education › School Choice and Performance
- Social Sciences › Education › Parental Involvement in Education
- Social Sciences › Sociology and Political Science › Intergenerational and Educational Inequality Studies
- Keywords
- parenting styles, peer effects, neighborhood effects, skill accumulation, adolescent development, peer group formation, busing, school integration, high school students, policy simulation
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