Abstract

Beca18 is a Peruvian social inclusion program for higher education. It provides full scholarships to economically disadvantaged public high school graduates who have been admitted to eligible universities. We exploit the random assignment of first-year students to small study groups at an elite university in Peru to evaluate how the interactions between relatively wealthy non-Beca18 students, who predominate at this institution, and Beca18 fellows affect early academic outcomes. We find that assignment to mixed study groups, composed of Beca18 and non-Beca18 students, on average improves performance on individual weekly/biweekly quizzes. In the case of Beca18 fellows, the positive effect of mixed-study environments is greater among fellows that possess relatively high academic ability as incoming students (that is, among those with higher pre-college academic ability). Interestingly, the opposite holds for non-Beca18 students. We identify two potential underlying mechanisms behind these results: (i) peers’ incoming (pre-college) academic ability and (ii) peer's attitudes towards effort and cooperation. Beca18 students in mixed study groups seem to benefit more from the relatively higher academic ability their non-Beca18 peers possess upon entrance. Non-Beca18 students appear to benefit from experiencing the higher effort and cooperation levels displayed by Beca18 fellows. Our evidence also suggests that some individuals may be adversely affected. These include Beca18 students who are toward the bottom of their socioeconomic group and non-Beca18 students who are at the top of their socioeconomic group in terms of pre-college ability distribution.

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