Racial identity and education in social networks

We investigate identity issues to explain differences in school performance between students of different races. Using a unique dataset of friendship relationships between students in the US, we show that friendship formation can be taken as a measure of racial identity. We then find that having a higher percentage of same-race friends is associated with higher test scores for white teenagers and with lower test scores for blacks. However, the higher is the education level of a black teenager’s parents, the lower is this negative association, while for whites, it is the reverse. It is thus the combination of choice of friends and parents’ education that seems to be an important factor in shaping differences in school performance between students of different races but also between students of the same race.