Citation
Lou, Tian & Ross, Stephen L. (2018). Popularity or future success? Friendship network formation for forward-looking teenagers. 2018 Add Health Users Conference. Bethesda, MD.Abstract
Previous literature has documented that teenagers gain utility from being popular in high school and that they tend to make friends with whom have similar attributes, such as the same race/ethnicity and maternal education. Moreover, other than immediate payoffs, teenagers may also obtain long-term economic gains from friendships: high school friends may influence teenagers' future educational attainment and incomes through their academic performance during high school. This paper aims to determine which better explains teenage friendship choices: the immediate payoffs or the anticipated long-term economic gains. We use a three-period dynamic model to include teenagers' friendship choices and outcomes in high school, as well as decisions and outcomes in college and labor market that are related to high school friendship choices. The model is estimated using Add Health data. Specifically, we utilize the friend nominations in the Wave I in-school survey to construct teenagers' friendship networks, and we use their incomes during the Wave IV survey as an approximation for the long-term economic payoffs. We find that male teenagers value their popularity during high school much more than they do the long-term economic benefits from friendships. Moreover, heterogeneity tests show that in general, African American and Hispanic students experience higher returns on both popularity and long-term economic gains from friendships than whites.Reference Type
Conference proceedingBook Title
2018 Add Health Users ConferenceAuthor(s)
Lou, TianRoss, Stephen L.