Classroom Peer Effects and Student Achievement

In this paper we analyze the impact of classroom peers ’ ability on individual student achievement with a rich longitudinal data set covering all Florida public school students in grades 3-10 over a five-year period. Unlike many previous data sets used to study peer effects in education, our data allow us to identify each member of a student’s classroom peer group in elementary, middle, and high school as well as the classroom teacher responsible for instruction. As a result, we can control for student fixed effects simultaneously with teacher fixed effects, thereby alleviating biases due to endogenous assignment of both peers and teachers, including some dynamic aspects of such assignments. Our estimation strategy, which measures the influence on individual test score gains of peers ’ fixed (observed and unobserved) characteristics, also alleviates potential biases due to measurement error of peer quality, simultaneity of peer outcomes, and mean reversion. Under linear-in-means specifications, estimated peer effects are small to non-existent, but we find some sizable and significant peer effects within non-linear models. For example, we find that peer effects depend on an individual student’s own ability and on the ability level of the peers under consideration, results that suggest net-welfare-improving redistributions of students across classrooms and/or schools. Estimated peer effects tend to be smaller when teacher fixed effects are included than when they are omitted, a result that suggests co-movement of peer and teacher quality within a student over time. We also find that classroom peers, as compared with the broader group of grade-level peers at the same school, exert a greater influence on individual achievement gains