Social Interactions and Schooling Decisions

44 Pages Posted: 7 Sep 2006

See all articles by Rafael Lalive

Rafael Lalive

University of Lausanne - Department of Economics; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Alejandra Cattaneo

University of Zurich

Multiple version iconThere are 2 versions of this paper

Date Written: August 2006

Abstract

The aim of this paper is to study whether schooling choices are affected by social interactions. Such social interactions may be important because children enjoy spending time with other children or parents learn from other parents about the ability of their children. Identification is based on a randomized intervention that grants a cash subsidy encouraging school attendance among a sub-group of eligible children within small rural villages in Mexico. Results indicate that (i) the eligible children tend to attend school more frequently, (ii) but also the ineligible children acquire more schooling when the subsidy is introduced in their local village, (iii) social interactions are economically important, and (iv) they may arise due to changes in parents' perception of their children's ability.

Keywords: peer effects, schooling, field experiment, PROGRESA

JEL Classification: C93, I21, I28

Suggested Citation

Lalive, Rafael and Cattaneo, Alejandra, Social Interactions and Schooling Decisions (August 2006). IZA Discussion Paper No. 2250, CESifo Working Paper Series No. 1787, Available at SSRN: https://ssrn.com/abstract=928786 or http://dx.doi.org/10.2139/ssrn.928786

Rafael Lalive (Contact Author)

University of Lausanne - Department of Economics ( email )

Batiment Internef
Lausanne, 1015
Switzerland

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Poschinger Str. 5
Munich, DE-81679
Germany

Alejandra Cattaneo

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

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