- Polarization when people choose their peers (latest 2020, first 2016) – joint with Paolo Pin – SSRN link – R&R at Games and Economic Behavior – New version coming soon
ABSTRACT: Processes of polarization have been documented in several applications. Yet most existing theories focus on how herding behavior and convergence of opinions tend to occur in different contexts. In this paper, we develop a model where agents correct their heterogeneous initial opinion by averaging the opinions of their neighbors. Our key contribution is to let the network arise endogenously. To do so, we micro–found how individuals optimally choose reference groups and we characterize a dynamic process where the network evolves along with individual opinions. Results show that there are always conditions on the strength of social influence preventing the network from being connected. This causes polarization in the long run. However, polarization can also arise during the transition to a consensus. We show how each of these cases is tied to a key network statistic, the initial diameter.
- A model of peer effects in school (latest 2021, first 2015)- SSRN link -Conditionally accepted at Mathematical Social Sciences – NEW VERSION!
ABSTRACT: When designing interventions aiming to foster peer effects in schools, knowledge on the endogenous sorting of individuals into groups is key. We propose a theoretical model where agents form groups endogenously, and their outcomes are affected accordingly. Using a popular payoff structure, we show that equilibrium outcomes have a direct correspondence with the linear-in-means model, used to study empirically peer effects and we characterize the set of stable networks. Further analytical results show that the model can explain the empirical results of Carrell et al. (2013). In particular, segregation in the classroom harms the transmission of peer effects that would benefit the lower achieving students. The presence of weak ties could counteract this outcome.
- Marriage with frictions: a revealed preference analysis – (2021) – joint with Cherchye, L. Demuynck, T. De Rock, B. and Merlino, L.P. – Working paper available soon
ABSTRACT: We extend the stable marriage (SM) framework of Cherchye et al. (2017) by introducing incomplete preferences (SMI). Agents meet a subset of potential partners and then make their marriage decisions conditionally on the set of meetings occurred. This extension has fundamental implications in the interpretation of data and their rationalizability. In particular we show how it is possible to identify the set of unmet blocking pairs in the data and the consideration set, despite not observing the meeting themselves. This allows to explain heterogeneity in the data by attributing differences to the frictions isolating the effect of unobservables.
Work in progress:
- Irrational addiction and rational social interactions (2021) – joint with Paolo Pin and Davide Dragone
- Marriage through friends (2021) – joint with Luca Paolo Merlino
- Consumer Theory with Social effects (2017) – joint with Yann Bramoulle`