Friends’ plans for college and adolescents’ educational expectations: an instrumental variable approach

Friends are an important influence on adolescents’ educational outcomes. However, because of their similarity on numerous attributes, it is difficult to estimate whether friends influence each other, or whether they select friends who are similar to them. To address this endogeneity, this study uses instrumental variable estimation on panel data from the High School Longitudinal Study of 2009 to estimate the effect of friends’ plans for college on adolescents’ educational expectations. Results from two-stage least squares models indicate that friends’ plans for college has a significant effect on educational expectations. This effect does not significantly vary by gender. Results suggest the need for policies that focus on ways to diversify adolescent peer networks in order to provide greater access to resource-rich peers.