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Sorting and Peer Effects

Author

Listed:
  • Behrang Kamali-Shahdadi

    (Department of Economics, TeIas Institute)

Abstract

The effect of sorting students based on their academic performances depends not only on direct peer effects but also on indirect peer effects through teachers' efforts. Standard assumptions in the literature are insufficient to determine the effect of sorting on the performances of students and so are silent on the effect of policies such as tracking, implementing school choice, and voucher programs. We show that the effect of such policies depends on the curvature of teachers' marginal utility of effort. We characterize conditions under which sorting increases (decreases) the total effort of teachers and the average performance of students.

Suggested Citation

  • Behrang Kamali-Shahdadi, 2016. "Sorting and Peer Effects," PIER Working Paper Archive 16-002, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 08 Feb 2016.
    • Handle: RePEc:pen:papers:16-002
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Indirect Peer Effects; Sorting; Comparative Statics;
    All these keywords.

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design
    • C60 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - General

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