Social Interactions and Schooling Decisions
44 Pages Posted: 7 Sep 2006
There are 2 versions of this paper
Social Interactions and Schooling Decisions
Social Interactions and Schooling Decisions
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: Suggested Citation
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