It’s Not What You Know, It’s Who You Know. Seriously.

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You know the old saying, “It’s not what you know, it’s who you know”? Well, Kelly Shue of the University of Chicago has found an intriguing way to test this. At Harvard Business School, students are randomly assigned to sections, where they presumably build strong friendships. (Stronger than the average friendship from just being at Harvard, anyway.) So what effect does this have on success later in life?

I test whether executive and firm outcomes are more similar among section peers than among class peers. I find evidence of significant peer effects in firm investment, leverage, interest coverage, and firm size, with the strongest effects in executive compensation and acquisition activity. Section peers are 10% more similar than class peers in terms of compensation and acquisitions.

In other words, if you get randomly assigned to a section with successful peers, you’re more likely to go along for the ride. I don’t have access to the article itself, and there are several possible explanations for this effect, but the most likely one is that friends help friends, and it’s nice to have friends who are successful. I hope there’s some followup research along these lines. It has some pretty obvious implications for diversity in schools, neighborhoods, and workplaces.

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

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