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1 – 10 of over 60000Bolun Li, Robin Sickles and Jenny Williams
Peers and friends are among the most influential social forces affecting adolescent behavior. In this chapter, the authors investigate peer effects on post high school career…
Abstract
Peers and friends are among the most influential social forces affecting adolescent behavior. In this chapter, the authors investigate peer effects on post high school career decisions and on school choice. The authors define peers as students who are in the same classes and social clubs and measure peer effects as spatial dependence among them. Utilizing recent developments in spatial econometrics, the authors formalize a spatial multinomial choice model in which individuals are spatially dependent in their preferences. The authors estimate the model via pseudo maximum likelihood using data from the Texas Higher Education Opportunity Project. The authors do find that individuals are positively correlated in their career and college preferences and examine how such dependencies impact decisions directly and indirectly as peer effects are allowed to reverberate through the social network in which students reside.
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Zhigang Xu, Kerong Zhang, Li Zhou and Ruiyao Ying
While the peer effects of technology adoption are well established, few studies have considered the variation in peer effects resulting from the mutual proximity between leaders…
Abstract
Purpose
While the peer effects of technology adoption are well established, few studies have considered the variation in peer effects resulting from the mutual proximity between leaders and followers and the heterogeneity of farmers' learning technology. This study addresses the gap in the literature by analyzing the peer effects of technology adoption among Chinese farmers.
Design/methodology/approach
Drawing on a government-led soil testing and formulated fertilization program, this study uses survey data of farmers from three Chinese provinces to examine the peer effects of technology adoption. This study uses a probit model to examine how mutual proximity influences peer effects and their heterogeneity. Accordingly, farmers were divided into two groups, namely small- and large-scale farmers, and then into leaders or followers depending on whether they were selected by the government as model farmers.
Findings
Both small- and large-scale farmers are more likely to use formula fertilizer if their peers do so. However, a large-scale farmer is more likely to adopt formula fertilizer if the average adoption behavior of other large-scale model (leader) farmers is higher, while a small-scale farmer is more likely to adopt formula fertilizer if other small-scale non-model (follower) farmers have higher average adoption behavior. Moreover, the peer effect was weakened by geographic distance among small-scale farmers and by economic distance among large-scale farmers.
Originality/value
This study elucidates the means of optimizing social learning and technology adoption among farmers.
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The purpose of this paper is to identify if peer firms’ capital structure decision plays a role in determining focal firms’ capital structure decision, despite the fact that…
Abstract
Purpose
The purpose of this paper is to identify if peer firms’ capital structure decision plays a role in determining focal firms’ capital structure decision, despite the fact that correlated effects can also lead to co-movement of financing behavior among firms from the same industry (i.e. industry-specific capital structure).
Design/methodology/approach
Instead of using relative measurement (of individual outcome variable over industry variable) as in previous work, this paper borrows the linear-in-means model and, after controlling for potential endogeneity problems, directly identifies the existence of peer effects with coefficient estimation. To deal with correlated effects, additional empirical investigations such as test of heterogeneity in direction and scale, social multiplier identification test and instrumental regression test based on another instrumental variable (that is less influenced by correlated effects) are performed.
Findings
Using data from Chinese listed firms, this paper, for the first time, identifies the presence of peer effects in capital structure and debt maturity decision. Further investigations show that first, focal firms react asymmetrically to peer firms’ debt adjustment of different direction and scale. Second, social multiplier, a unique attribute of peer effects, is identified in the leverage choices. Third, the significant correlation of capital structure decision remains even if we use another “correlated effects-immune” instrument. All these results point to the fact that peer effects, rather than correlated effects, play a significant role in determining capital structure.
Practical implications
The empirical results of this paper provide strong evidence that firms, driven by motivations such as either learning or competition, will actively react to peers’ financial decisions. As the bridge between individual firms and the industry, social multiplier can be fully taken advantage of to induce positive spillover of good management practices and prohibit inefficient decisions from spreading.
Originality/value
This paper theoretically and empirically introduces peer effects – a well-acknowledged social concept – into capital structure decision of Chinese listed firms, thus both complementing the traditional capital structure theory and providing an empirical paradigm for peer effects research.
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This study uses a budgeting experiment to examine the effects of peer influence and firm earnings position on managerial honesty. In the experiment, participants report production…
Abstract
This study uses a budgeting experiment to examine the effects of peer influence and firm earnings position on managerial honesty. In the experiment, participants report production costs to request funds from the firm based on their actual private cost information. The firm’s earnings position is manipulated at two levels, a gain condition and an edge condition, and the authors find that participants overstate costs (i.e., are less honest) to a greater extent in the dishonest peer influence condition than in the honest peer influence condition. The authors also find that the effect of peer influence on managerial honesty is context dependent. Specifically, participants respond to both dishonest and honest peer influence in the gain condition but they do not respond to peer influence in the edge condition. This study provides evidence for honest peer influence on honesty and it highlights the role of earnings position on the effect of peer influence on honesty. Controlling the disclosure of certain peer information is not possible because individuals can learn about peer information (honest or dishonest) formally or informally. Such uncontrollable peer information may be harmful to firms. The results suggest firms that provide managers with the consequences of managerial budgeting on the firm operational outcomes can neutralize the effect of peer influence on managerial honesty when managers’ budgeting decisions significantly affect firm profits.
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We present an overview of research on spillover effects within firms and introduce a classification of the literature. We divide spillovers into either technological or social in…
Abstract
We present an overview of research on spillover effects within firms and introduce a classification of the literature. We divide spillovers into either technological or social in nature. In our classification, a technological spillover is one in which an agent rationally responds to a cue in the workplace that does not rely on the identity or characteristics of a coworker. Social spillovers, on the other hand, may be thought of as arising from the social preferences of an individual or social norms established in the organization.
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The online health community's success depends on doctors' active participation, so it is essential to understand the factors that affect doctors' knowledge contribution behavior…
Abstract
Purpose
The online health community's success depends on doctors' active participation, so it is essential to understand the factors that affect doctors' knowledge contribution behavior in the online health communities. From the perspective of peer effect, this paper discusses the influence of focal doctors' peers on focal doctors' knowledge contribution behavior and the mechanism behind it. This paper aims to solve these problems.
Design/methodology/approach
Empirical data of 1,938 doctors were collected from a Chinese online health community, and propensity score matching and ordinary least squares were employed to verify the proposed theoretical model.
Findings
The results show that the presence of focal doctors' peers in online health communities has a positive effect on the knowledge contribution behavior of focal doctors, and the economic returns and social returns of focal doctors' peers have a significant mediating effect.
Originality/value
This paper discusses focal doctors' knowledge contribution behavior from the perspective of peer effect. It enhances the understanding of focal doctors' behavior in the online health communities by exploring the mediating role of their peers' economic and social returns. The results of this paper extend the research in the field of peer effect and online health and provide management implications and suggestions for online health platforms and doctors.
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Neeraj Jain and Smita Kashiramka
This study aims to investigate the effects of peers on corporate payout policies in one of the largest emerging markets – India. It also examines the motives for mimicking payout…
Abstract
Purpose
This study aims to investigate the effects of peers on corporate payout policies in one of the largest emerging markets – India. It also examines the motives for mimicking payout decisions.
Design/methodology/approach
The sample is composed of 3,024 non-financial and non-government firms listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) for the period 1995 to 2020. To encounter the endogeneity problem, the instrumental variable technique based on peer firms' idiosyncratic risk is used to estimate the effects of peers on firms' payout policy. To define peer reference groups, the authors use the basic industry classification of the firms.
Findings
The results indicate a significant positive impact of peers on firms' dividend policies in India. A firm with all dividend-paying peers is more likely to declare dividends than the one with no dividend-paying peers. Further, peer effects are found to be more pronounced amongst larger and older firms, thus supporting the rivalry theory of mimicking.
Originality/value
To the best of the authors' knowledge, the present study is the first of its kind that attempts to understand peer effects on payout decisions in an emerging market India, that offers a unique institutional setting. Moreover, the authors extend the existing literature by investigating the peer effects on a firm's payout policies considering various firm-level characteristics, such as growth opportunity, cash holding, financial constraint and profitability, which previous studies have not taken into consideration. These results provide additional insights into the heterogeneity and motives behind peer effects.
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Wanhong Li, Fan Wang, Tiansen Liu, Qinglian Xue and Nan Liu
The use of digital technology in firms has drawn attention of innovation management scholars and policy-makers, especially the imitation of digital technology and competition…
Abstract
Purpose
The use of digital technology in firms has drawn attention of innovation management scholars and policy-makers, especially the imitation of digital technology and competition among peer firms. Drawing on dynamic competition theory, this paper examines how firms react to their peers' digital innovation behavior and the effect of external environment mechanisms on the magnitude of peer effects.
Design/methodology/approach
This paper utilizes a text mining method to construct a baseline model with a Tobit estimator using data obtained for Chinese listed firms.
Findings
The findings suggest that peer effects on digital innovation behavior are robust and significant positive in China. Moreover, peer effects on digital innovation participation are positively magnified by firms' strong social network and high Fintech development. However, peer effects are relatively higher in non-state-owned enterprises (non-SOEs), low-profitability and high R&D firms.
Research limitations/implications
The authors' findings contribute to the digital management literature by showing that firms need digital technological imitation and diffusion of innovations in the digital era.
Practical implications
Managers should provide insights into firms' imitation of their peers' acts to preserve competitive parity. Besides, firms should integrate employees within the organization and communicate digital innovation concepts and behaviors to external peer firms.
Originality/value
First, this paper contributes to explaining how firms change their digital innovation strategy through the influence of peers' digital innovation behavior. Second, this paper fills the literature gaps related to the moderating effects of external environment factors in peer effects of digital innovation behavior.
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Yanliang Niu, Renjie Zhang, Guangdong Wu and Qianwen Zhou
This study explores whether the peer effects of internationalization exist within the subdivision industry of enterprises in the engineering field and assesses the imitation paths…
Abstract
Purpose
This study explores whether the peer effects of internationalization exist within the subdivision industry of enterprises in the engineering field and assesses the imitation paths for the peer engineering enterprises within the industry when implementing internationalization strategies under the peer effects.
Design/methodology/approach
This study collected secondary and objective data on 38 Chinese engineering enterprises from the Engineering News-Record's list of the top 250 international contractors between 2013 and 2021. It employed a regression analysis to test the research hypotheses.
Findings
The findings reveal that in the process of internationalization: (1) peer effects exist within the subdivision industry of internationalization of engineering enterprises; (2) engineering enterprises within the same industry and region imitate each other; (3) non-state-owned engineering enterprises imitate state-owned engineering enterprises within the same industry; and (4) in the industry follower–leader imitation process, industry followers imitate leaders according to enterprise size and return on assets.
Originality/value
The results contribute to a better understanding of how peer effects influence engineering enterprises' internationalization process. This study also proposes imitation paths based on the law of imitation to provide recommendations for engineering enterprises' better development in the international market.
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Li Zhou, Fan Zhang, Shudong Zhou and Calum G. Turvey
The purpose of this paper is to examine the relationships of technical training and the peer effects of technical training with farmers' pesticide use behaviors.
Abstract
Purpose
The purpose of this paper is to examine the relationships of technical training and the peer effects of technical training with farmers' pesticide use behaviors.
Design/methodology/approach
This study uses survey data from 300 peanut growers in Zoucheng County, Shandong, China, in 2016 and employs spatial econometric models to examine the relationships of technical training and the peer effects of technical training with farmers' pesticide use behaviors.
Findings
This paper reveals that important peer effects can be channeled through technical training and that these peer effects are sufficiently significant to encourage neighboring farmers to reduce the amount of pesticide use, to transform the structure of pesticide use, and to increase the usage amount of low-toxicity, low-residue pesticide use per hectare. The estimated parameters for the peer effects from technical training are significantly larger than those from technical training alone, which suggests that the technical training of neighboring farmers plays a greater role than technical training for farmers individually.
Originality/value
The research finds that technical training within smaller, localized, groups can induce previously unobservable spillover effects, and this provides a scientific, theoretical and empirical justification for agricultural technology extension that can lead to a rapid, effective transformation of applying new agricultural technologies in an environmentally sensitive and economically sustainable manner.
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