Teachers Teaching Teachers: The Role of Networks on Financial Decisions

64 Pages Posted: 5 Nov 2015 Last revised: 9 Feb 2017

Gonzalo Maturana

Emory University - Goizueta Business School

Jordan Nickerson

Boston College

Date Written: February 7, 2017

Abstract

This paper studies the role of peers in the transmission of information pertinent to household financial decisions. Specifically, we examine the effect of peers on the mortgage refinancing decisions of school teachers in Texas by exploiting commonalities in teacher schedules to identify peer groups. Using this source of within-campus variation to separate campus-level unobservable shocks, we find that refinancing activity among a teacher's peers increases her likelihood of refinancing by 16.4%. Peers also affect a teacher's choice of lender. Overall, our findings suggest that a household's cost of acquiring and processing financial information is greatly reduced by interacting with peers.

Keywords: Household Finance, Peer Effects, Mortgages, Refinancing

JEL Classification: D71, G21, H31, R20

Suggested Citation

Maturana, Gonzalo and Nickerson, Jordan, Teachers Teaching Teachers: The Role of Networks on Financial Decisions (February 7, 2017). Available at SSRN: https://ssrn.com/abstract=2686300 or http://dx.doi.org/10.2139/ssrn.2686300

Gonzalo Maturana

Emory University - Goizueta Business School ( email )

1300 Clifton Road
Atlanta, GA 30322-2722
United States

HOME PAGE: http://www.gonzalomaturana.com/

Jordan Nickerson (Contact Author)

Boston College ( email )

Carroll School of Management
140 Commonwealth Avenue
Chestnut Hill, MA 02467-3808
United States

Paper statistics

Downloads
195
Rank
127,703
Abstract Views
1,248