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DISCUSSION PAPER SERIES DP13771 (v. 2) FRIENDSHIP NETWORKS AND POLITICAL OPINIONS: A NATURAL EXPERIMENT AMONG FUTURE FRENCH POLITICIANS Yann Algan, Nicolò Dalvit, Quoc-Anh Do, Alexis Le Chapelain and Yves Zenou LABOUR ECONOMICS PUBLIC ECONOMICS ISSN 0265-8003 FRIENDSHIP NETWORKS AND POLITICAL OPINIONS: A NATURAL EXPERIMENT AMONG FUTURE FRENCH POLITICIANS Yann Algan, Nicolò Dalvit, Quoc-Anh Do, Alexis Le Chapelain and Yves Zenou Discussion Paper DP13771 First Published 01 June 2019 This Revision 27 December 2020 Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK Tel: +44 (0)20 7183 8801 www.cepr.org This Discussion Paper is issued under the auspices of the Centre’s research programmes: Labour Economics Public Economics Any opinions expressed here are those of the author(s) and not those of the Centre for Economic Policy Research. Research disseminated by CEPR may include views on policy, but the Centre itself takes no institutional policy positions. The Centre for Economic Policy Research was established in 1983 as an educational charity, to promote independent analysis and public discussion of open economies and the relations among them. It is pluralist and non-partisan, bringing economic research to bear on the analysis of medium- and long-run policy questions. These Discussion Papers often represent preliminary or incomplete work, circulated to encourage discussion and comment. Citation and use of such a paper should take account of its provisional character. Copyright: Yann Algan, Nicolò Dalvit, Quoc-Anh Do, Alexis Le Chapelain and Yves Zenou FRIENDSHIP NETWORKS AND POLITICAL OPINIONS: A NATURAL EXPERIMENT AMONG FUTURE FRENCH POLITICIANS Abstract We study how social interaction and friendship shape students' political opinions in a natural experiment at Sciences Po, the cradle of top French politicians. We exploit arbitrary assignments of students into short-term integration groups before their scholar cursus, and use the pairwise indicator of same-group membership as instrumental variable for friendship. After six months, friendship causes a reduction of differences in opinions by one third of the standard deviation of opinion gap. The evidence is consistent with a homophily-enforced mechanism, by which friendship causes initially politically-similar students to join political associations together, which reinforces their political similarity, without exercising an effect on initially politically-dissimilar pairs. Friendship affects opinion gaps by reducing divergence, therefore polarization and extremism, without forcing individuals' views to converge. Network characteristics also matter to the friendship effect. JEL Classification: C93, D72, Z13 Keywords: Political opinion, Polarization, friendship effect, Social Networks, homophily, extremism, learning, Natural Experiment Yann Algan - [email protected] Sciences Po Nicolò Dalvit - [email protected] Sciences Po Quoc-Anh Do - [email protected] Northwestern University, Sciences Po and CEPR Alexis Le Chapelain - [email protected] N/A Yves Zenou - [email protected] Monash University and CEPR Acknowledgements We thank valuable comments from Alberto Alesina, Ghazala Azmat, Roland Bénabou, Yann Bramoullé, Emily Breza, Jing Cai, Arun Chandrasekhar, Aureo De Paula, Ruben Durante, Georgy Egorov, Ruben Enikolopov, Marcel Fafchamps, Gigi Foster, Jeff Frieden, Matt Gentzkow, Ben Golub, Sanjeev Goyal, Nicolaj Harmon, Emeric Henry, Yannis Ioannides, Emir Kamenica, Ethan Kaplan, Rachel Kranton, Eliana La Ferrara, Horacio Larreguy, Alexandre Mas, Friederike Mengel, Markus M. Möbius, Nancy Qian, Gautam Rao, Imran Rasul, Andrei Shleifer, Erik Snowberg, Enrico Spolaore, Andreas Steinmayr, Uwe Sunde, Adam Szeidl, Fabian Waldinger, Noam Yuchtman, and from seminar and conference participants at Kellogg SoM, UIUC, Adansonia conference at U Bocconi, HSE Moscow, NES, UBC, CREST Political Economy workshop, UNSW, Monash U, NUS, Queen Mary U, U of Copenhagen, Royal Holloway, Brazilian Econometric Society meeting, LMU Munich, Harvard U, U of Chicago, U Autònoma de Barcelona, Monash U Symposium on Social and Economic Networks, Barcelona Summer Forum, the Social Impacts of Economic Policies and Change conference in Heidelberg, the AEA Meeting, the Information Transmission in Networks conference at Harvard, and Aix-Marseille School of Economics. We are thankful for Sri Srikandan's assistance with the survey website. Algan acknowledges support from the European Research Council Grant 647870. Do is grateful for the generous hospitality of Harvard University's Department of Economics and Weatherhead Center For International Affairs, and financial support from the French National Research Agency's (ANR) "Investissements d'Avenir" grants ANR-11-LABX-0091 (LIEPP) and ANR-11-IDEX-0005-02 (USPC), and the Banque de France - Sciences Po partnership. The remaining errors are ours. Powered by TCPDF (www.tcpdf.org) Friendship Networks and Political Opinions: A Natural Experiment among Future French Politicians Yann Algan∗ Nicol`oDalvity Quoc-Anh Doz Alexis Le Chapelain Yves Zenoux December 2020 Abstract We study how social interaction and friendship shape students' political opinions in a natural experiment at Sciences Po, the cradle of top French politicians. We exploit arbitrary assignments of students into short-term integration groups before their scholar cursus, and use the pairwise indicator of same-group membership as instrumental variable for friendship. After six months, friendship causes a reduction of differences in opinions by one third of the standard deviation of opinion gap. The evidence is consistent with a homophily-enforced mechanism, by which friend- ship causes initially politically-similar students to join political associations together, which reinforces their political similarity, without exercising an effect on initially politically-dissimilar pairs. Friendship affects opinion gaps by reducing divergence, therefore polarization and extrem- ism, without forcing individuals' views to converge. Network characteristics also matter to the friendship effect. Keywords: Political opinion, polarization, friendship effect, social networks, homophily, ex- tremism, learning, natural experiment. JEL classification codes: C93, D72, Z13. ∗Sciences Po and CEPR. Email: [email protected]. ySciences Po. Email: [email protected]. zNorthwestern University, Sciences Po, and CEPR. Email: [email protected]. xMonash University and CEPR. Email: [email protected]. 1We thank valuable comments from Alberto Alesina, Ghazala Azmat, Roland B´enabou, Yann Bramoull´e,Emily Breza, Jing Cai, Arun Chandrasekhar, Aureo De Paula, Ruben Durante, Georgy Egorov, Ruben Enikolopov, Marcel Fafchamps, Gigi Foster, Jeff Frieden, Matt Gentzkow, Ben Golub, Sanjeev Goyal, Nicolaj Harmon, Emeric Henry, Yannis Ioannides, Emir Kamenica, Ethan Kaplan, Rachel Kranton, Eliana La Ferrara, Horacio Larreguy, Alexandre Mas, Friederike Mengel, Markus M. M¨obius,Nancy Qian, Gautam Rao, Imran Rasul, Andrei Shleifer, Erik Snowberg, Enrico Spolaore, Andreas Steinmayr, Uwe Sunde, Adam Szeidl, Fabian Waldinger, Noam Yuchtman, and from seminar and conference participants at Kellogg SoM, UIUC, Adansonia conference at U Bocconi, HSE Moscow, NES, UBC, CREST Political Economy workshop, UNSW, Monash U, NUS, Queen Mary U, U of Copenhagen, Royal Holloway, Brazilian Econometric Society meeting, LMU Munich, Harvard U, U of Chicago, U Aut`onoma de Barcelona, Monash U Symposium on Social and Economic Networks, Barcelona Summer Forum, the Social Impacts of Economic Policies and Change conference in Heidelberg, the AEA Meeting, the Information Transmission in Networks conference at Harvard, and Aix-Marseille School of Economics. We are thankful for Sri Srikandan's assistance with the survey website. Algan acknowledges support from the European Research Council Grant 647870. Do is grateful for the generous hospitality of Harvard University's Department of Economics and Weatherhead Center For International Affairs, and financial support from the French National Research Agency's (ANR) \Investissements d'Avenir" grants ANR-11-LABX-0091 1 1 Introduction The recent rise of populism and political polarization has attracted a burgeoning research area on the related role of social interactions in social networks. Several authors attribute political polarization to the rise of social media (e.g., Sunstein, 2009, 2018; Pariser, 2011), which fosters echo chambers that facilitate more interactions between like-minded individuals, thus strengthen polarization of views. Others debate the quantitative importance of such mechanism (e.g., Boxell et al., 2018; Allcott and Gentzkow, 2017; Guess et al., 2018) A key understudied input in this heated debate remains the causal impact of social interactions in social networks on political opinions, since echo chambers cannot imply the polarization of opinions in absence of such impact. This paper provides estimates of such impact that address the endogeneity bias due to individuals' choices to interact and form networks, by exploiting a natural experiment at the elite French Institute of Political Studies, Sciences Po, that quasi-randomly allocates first-year students into groups at the beginning of their studies. In the spirit of Lazarsfeld et al.'s (1944) seminal description of friends' influence on US voters, we extend beyond average group effects to focus on the role of friendship between individuals in the same group. We investigate how the