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Identifying Peer Effects Using Gold Rushers

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  • John Lynham

Abstract

Fishers pay attention to where other fishers are fishing, suggesting the potential for peer effects. But peer effects are difficult to identify without an exogenous shifter of peer group membership. We propose an identification strategy that exploits a shifter of peer group membership: gold rushes of new entrants. Following an exchange-rate-induced gold rush in an American fishery, we find that new entrants are strongly influenced by the location choices of their peers. Overidentification tests suggest that the assumptions underlying identification hold when new entrants are inexperienced, but identification is lost as new entrants start to potentially influence their peers.

Suggested Citation

  • John Lynham, 2017. "Identifying Peer Effects Using Gold Rushers," Land Economics, University of Wisconsin Press, vol. 93(3), pages 527-548.
    • Handle: RePEc:uwp:landec:v:93:y:2017:i:3:p:527-548
    Note: DOI: 10.3368/le.93.3.527
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    3. Emilio Castillo, 2020. "Mineral Exploration and the Discovery of New Deposits," Working Papers 2020-06, Colorado School of Mines, Division of Economics and Business.
    4. Sampson, Gabriel & Perry, Edward & Hendricks, Nathan P., 2017. "The Role of Peer Effects in Resource Extraction - The Case of Kansas Groundwater," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258286, Agricultural and Applied Economics Association.

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    More about this item

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery

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