The role of testing noise in the estimation of achievement-based peer effects

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2 Citations (Scopus)

Abstract

I demonstrate that in the value-added estimation of peer effects using lagged peer achievement, testing noise may generate another bias in addition to the well-known attenuation bias. Such a bias, which I refer to as the “reversion bias,” may arise when some of a student's current peers happen to be his/her former peers whose performances in the baseline test were subject to the same common testing noise as the student's own. I propose a solution to overcome this problem by exploiting only the variation in the new peers’ portion of the overall peer quality. Using real-world data, I illustrate the existence of this bias and demonstrate the proposed solution.

Original languageEnglish
Pages (from-to)113-123
Number of pages11
JournalEconomics of Education Review
Volume54
DOIs
Publication statusPublished - 1 Oct 2016

Scopus Subject Areas

  • Education
  • Economics and Econometrics

User-Defined Keywords

  • Mean reversion
  • Measurement error
  • Peer effects
  • Student achievement

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