The effect of peers on HIV infection expectations among Malawian adolescents: Using an instrumental variables/school fixed effect approach.

Malawian adolescents overestimate their HIV infection risk. Understanding why they do so is important since such overestimation is likely to be linked to later-life outcomes. This study focuses on the influence peers have on HIV infection expectations. I use novel school-based survey data collected in Malawi between October 2011 and March 2012 (n = 7910), which has more reliable measures of peers' HIV infection expectations than other studies. I employ a combined instrumental variables/fixed effects methodology designed to addresses several methodological challenges in estimating peer effects, including self-selection of friends, the issue of unobserved environmental confounders, and the bi-directionality of peer effects. Several tests are conducted in order to assess the robustness of the specifications. Results suggest that a one-percentage-point increase in the mean probabilistic expectation of HIV infection among peers increases an adolescent's own subjective expectation of infection by an average of 0.65 percentage points. This paper shows that peer influence is greater for males than for females. Results also suggest that the peer effects on HIV infection expectations are only statistically significant among those lacking more complete knowledge of HIV/AIDS.