Haskell, N. (2022). The effects of being racially, ethnically, & socioeconomically different from peers. Social Science Research, 102808.

Classroom diversity in observable characteristics has been shown in priorliterature to have different effects on the educational and behavioraloutcomes of students with observable characteristics that differ from theirpeers. Given that similarity in observable characteristics plays a criticalrole in social interactions (homophily), students may experience social coststo being racially, ethnically, and socioeconomically very different fromtheir peers. We test these implications using reduced form regressions on AddHealth data, where identification comes from exogenous variation in thedemographic composition of grades within a school. Empirical findings suggestthat students who are more socioeconomically different from same-gender peersare less happy, feel less socially accepted, and do worse academically,particularly in low diversity environments. However, racially differentstudents put forth more effort by participating in extracurricular activitieswhen diversity is low. High diversity environments generate morenonconformity (e.g., altercations with other students) among raciallydifferent students, although academic outcomes improve. The results highlightthe complexity and importance of considering group composition when weighingpolicy initiatives that alter the distribution of student types across highschools.