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Young adults living with their parents and the influence of peers

Adamopoulou, Effrosyni and Kaya, Ezgi ORCID: 2018. Young adults living with their parents and the influence of peers. Oxford Bulletin of Economics and Statistics 80 (3) , pp. 689-713. 10.1111/obes.12198

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This study examines the impact of peer behaviour on the living arrangements of young adults in the United States. Using data from the National Longitudinal Study of Adolescent Health (Add Health), we analyse the influence of high school friends on the nest-leaving decisions of young adults. We achieve identification by exploiting the differences in the timing of leaving the parental home among peers, the individual-specific nature of the peer groups that are based on friendship nominations, and by including school (network) and grade (cohort) fixed effects. Our results indicate that there are statistically significant peer effects on the decisions of young adults to leave the parental home. This is true even after we control for labour and housing market conditions, as well as for a comprehensive list of individual and family-of-origin characteristics that are usually unobserved by the econometrician. We discuss various mechanisms and confirm the robustness of our results through a placebo exercise. Our findings reconcile with the increasing proportion of young adults who are living with their parents in the United States, a trend that is persisting, even since the end of the Great Recession.

Item Type: Article
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HQ The family. Marriage. Woman
Uncontrolled Keywords: peer e§ects, friends, living arrangements, leaving parental home
Publisher: Wiley
ISSN: 0305-9049
Date of First Compliant Deposit: 29 June 2018
Date of Acceptance: 5 May 2017
Last Modified: 01 Dec 2023 17:22

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