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Peer Effects in Tournaments for Status: Evidence from Rank Dynamics of U.S. Colleges and Universities

Posted by admin in 2012

Noah S. Askin and Matthew S. Bothner

Individual outcomes in tournaments for status result not only from participants’ own qualities and behaviors, but also from those of their most proximate peers. In this article, we take an alter-centric view of status dynamics, examining the effect of peers’ perceived quality on future changes in a focal organization’s status. Utilizing the yearly tournaments created by U.S. News & World Report’s rankings of national colleges and universities, two competing predictions are investigated. The first is that peer’ advances in perceived quality impair the future status of a focal school, reflecting inter-school competition for finite resources and rewards. The second is that peers’ improvements incite a focal school to make cosmetic or material adjustments, leading to an increase in its status. Peers are defined in two ways: by proximity in the prior iteration of the tournament and by network-based structural equivalence. Using fixed effects models predicting future changes in annual USN ranks, we observe opposing forces at work, depending on the type of peer exerting influence. When peers identified by prior rank proximity improve in perceived quality, they exert status-eroding effects on a focal school. Conversely, when structurally equivalent peers in the college-applicant market show improvement, the focal school subsequently increases in status. We examine the mechanisms responsible for this divergence by focusing on the bases of each type of peer-affiliation, presenting interaction effects that highlight the contextual conditions that shape the influence of peers on status change. Future directions for research on peer effects and status are discussed.

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