Working Paper: CEPR ID: DP14997
Authors: Vincent Boucher; Carlo Del Bello; Fabrizio Panebianco; Thierry Verdier; Yves Zenou
Abstract: We propose a model of intergenerational transmission of education wherein children belong to either high-educated or low-educated families. Children choose the intensity of their social activities, while parents decide how much educational effort to exert. We characterizethe equilibrium and show the conditions under which cultural substitution or complementarity emerges. Using data on adolescents in the United States, we structurally estimate our model and find that, on average, children’s homophily acts as a complement to the educational effort of high-educated parents but as a substitute for the educational effort of low-educated parents. We also perform some policy simulations. We find that policies that subsidize social interactions can backfire for low-educated students because they tend toincrease their interactions with other low-educated students, which reduce the education effort of their parents and, thus, their chance of becoming educated.
Keywords: Social Networks; Education; Homophily; Cultural Transmission
JEL Codes: D85; I21; Z13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| children's homophily (C92) | parental educational effort (I24) |
| parental educational effort (I24) | children's educational outcomes (I21) |
| children's homophily (C92) | children's educational outcomes (I21) |
| low-educated children's socialization with low-educated peers (I24) | parental educational effort (I24) |
| subsidizing social interactions (H49) | low-educated children's socialization with low-educated peers (I24) |
| subsidizing social interactions (H49) | parental educational effort for low-educated children (I24) |