Social interactions and social preferences in social networks

Abstract

Summary We study social interactions when individuals hold altruistic preferences in social networks. Rich network features can be captured in the resulting best response function. The inward network links provide unique information for identifying the altruism effect. We demonstrate that the often ignored altruism is another serious confounding factor of peer effects. Specifically, the estimates of peer effects are approximately 36% smaller after taking into account social preferences. Furthermore, we could identify two types of effects caused by peers' outcomes: the spillover effects and the externality effects, which is impossible in a conventional social interactions model based on the self‐interest hypothesis.

Spatial Models for Identifying Factors in Student Academic Achievement

“…Although a powerful theoretical structure is included in the publications that consider interaction effects (Manski, 1993;Elhorst, 2010;Elhorst et al, 2013), spatial models are not common in studies of the effects of student interaction on student achievement Even though dummies represent the effect of similarities, spatial models may represent additional information, such as the type and level of interaction, direct and indirect linkages and a holistic interaction. On the other hand, as noted by Hsieh and Lin (2019), who were among to use spatial models of student achievement, "the literature on social interactions has mainly focused on the influences of peers on behaviors and decisions of an individual, rarely considering the possible formation of social preferences among the network links". Other examples use spatial models to estimate student achievement (Matlock et al, 2014;Zangger, 2016).…”

Peer smoking among brazilian adolescents: are the effects of social interaction in school classes relevant?

“…The first effect briefly relates to how average or common behavior affects an individual's chances of behaving similarly within the social group; the second concept is related to how exogenous characteristics of the group affect the individual's behavior and finally, the third effect is a cross-relationship between the pair effect and the contextual one. Measuring both effects and verifying their magnitude in the Brazilian context is to converge with what has been done in the international scientific literature, as in Hsieh and Lin (2021). The respective effects can be grouped around a single definition, which are social externalitiessocial multiplier effectswhich are studied in microeconomic theory (BOUNDREAUX and MAINERS, 2019).…”

“…Studies in economics of how consumer's choices depend not only on individual factors, but on factors external to them -those who make decisions -have recently been established in the theoretical and empirical literature (HSIEH and LIN 2021;MATSON, 2021). Within a wider universe of possibilities for analyzing preferences and choices, health-related behaviors are also research objects and how social interactions between agents contribute or not to outputs in this area, especially in adolescence/school socialization environment.…”