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Testing random assignment to peer groups

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  • Koen Jochmans

Abstract

Identification of peer effects is complicated by the fact that the individuals under study may select their peers. Random assignment to peer groups has proven useful to sidestep such a concern. In the absence of a formal randomization mechanism, it needs to be argued that assignment is “as good as” random. This paper introduces a simple yet powerful test to do so. We provide theoretical results for this test. As a by‐product, we equally obtain such results for an approach popularized by Guryan et al. (2009). These results help to explain why this approach suffers from low power, as has been observed elsewhere.

Suggested Citation

  • Koen Jochmans, 2023. "Testing random assignment to peer groups," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 38(3), pages 321-333, April.
    • Handle: RePEc:wly:japmet:v:38:y:2023:i:3:p:321-333
    DOI: 10.1002/jae.2953
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    Cited by:

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    2. Carneiro, Pedro & Cruz Aguayo, Yyannu & Salvati, Francesca & Schady, Norbert, 2023. "The Effect of Classroom Rank on Learning throughout Elementary School: Experimental Evidence from Ecuador," IZA Discussion Papers 16384, Institute of Labor Economics (IZA).
    3. Pedro Carneiro & Yyannu Cruz Aguayo & Francesca Salvati & Norbert Schady, 2024. "The Effect of Classroom Rank on Learning Throughout Elementary School: Experimental Evidence from Ecuador," CESifo Working Paper Series 11456, CESifo.
    4. Jonas Radbruch & Amelie Schiprowski, 2020. "Interview Sequences and the Formation of Subjective Assessments," ECONtribute Discussion Papers Series 045, University of Bonn and University of Cologne, Germany.

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    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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