Be as Careful of the Company You Keep as of the Books You Read: Peer Effects in Education and on the Labor Market / Giacomo De Giorgi, Michele Pellizzari, Silvia Redaelli.

Format:

Book

Author/Creator:

De Giorgi, Giacomo.

Contributor:

National Bureau of Economic Research.

Pellizzari, Michele.

Redaelli, Silvia.

Series:

Working Paper Series (National Bureau of Economic Research) no. w14948.

NBER working paper series no. w14948

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Be as Careful of the Company You Keep as of the Books You Read

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2009.

Summary:

In this paper we investigate whether peers' behavior influences the choice of college major, thus contributing to the mismatch of skills in the labor market. Using a newly constructed dataset, we are able to identify the endogenous effect of peers on such decisions through a novel identification strategy that solves the common econometric problems of studies of social interactions. Results show that, indeed, one is more likely to choose a major when many of her peers make the same choice. We also provide evidence on skills mismatch in terms of entry wages and occupation. We find that peers can divert students from majors in which they have a relative ability advantage, with adverse consequences on academic performance, entry wages and job satisfaction.

Notes:

Print version record

May 2009.