Summary

The identification of peer effects is challenging. There are many factors not related to social influences that could explain correlations among peers. Peers have been shown to affect many important outcomes, including academic performance and educational trajectories. Confirming the existence of peer effects is important from a policy perspective. Both the cost-benefit analysis and the design of policies are likely to be affected by the existence of social spillovers. However, making general policy recommendations from the current evidence is not easy. The size of the peer effects documented in the literature varies substantially across settings and depends on how peers are defined and characterized. Understanding what is behind this heterogeneity is thus key to extract more general policy lessons. Access to better data and the ability to map social networks will likely facilitate investigating which peers and which characteristics matter the most in different contexts. Conducting more research on the mechanisms behind peer effects is also important. Understanding these drivers is key to take advantage of social spillovers in the design of new educational programs, to identify competing policies, and to gain a deeper understanding of the nature and relevance of different forms of social interactions for the youth.