The Effects of Racial and Extracurricular Friendship Diversity on Achievement

This paper finds the effect of having friends of a similar race and who are involved in similar activities. It explores data which allows a peer group to be defined openly through self nominations. Using a strategy that corrects for the endogeneity of peer effects by instrumenting using variables at the grade within school level, it is shown that friendship diversity can help whites increase achievement. Although not much significance was found with other races, most of the strategies pushed towards the direction of racial diversity aiding achievement. Regarding extracurricular activities, it is found that there is a benefit in having friends in common individual academic activities, conditional on the respondent only belonging to academic or scholastic clubs. There are insignificant effects in having friends in common sports, conditional on the respondent only participating in sports