Concerns about excessive mobile phone use among youth are mounting. We present estimates of behavioral and contextual peer effects, along with comprehensive evidence on how students’ own and their peers’ app usage affect academic performance, physical health, and labor market outcomes. Our analysis draws on administrative data from a Chinese university covering three student cohorts over four years. We exploit random roommate assignments, differential exposure to a policy shock (gaming restrictions for minors), and differential exposure to a discrete event (the introduction of a blockbuster video game) for identification. App usage is contagious: a one s.d. increase in roommates’ in-college app usage raises own usage by 5.8%. High app usage is harmful across all measured outcomes. A one s.d. increase in app usage reduces GPAs by 36.2% of a within-cohort-major s.d. and lowers wages by 2.3%. Roommates’ app usage reduces a student’s GPA and wages through both disruptions and behavioral spillovers, generating a total negative effect that exceeds half the magnitude of the impact from the student’s own app usage. Extending China’s three-hour-per-week gaming restriction for minors to college students would boost their initial wages by 0.9%. High-frequency GPS and app usage data show that heavy app users spend less time in study halls, are more frequently late or absent from class, and get less sleep.

The third challenge stems from the well-known difficulties in identifying peer effects in empirical settings, including the endogeneity of peer group formation and the “reflection problem” first articulated by Manski (1993)—an individual’s behavior both affects and is affected by their peers, making it difficult to establish causality. Disentangling the two classical types of peer effects, behavioral (endogenous) and contextual (exogenous) peer effects, is even more challenging (Manski 1993; Bramoullé, Djebbari, and Fortin 2020). In our context, the behavioral peer effects refer to how roommates’ action of app playing influences a student’s own app usage. Contextual peer effects, by contrast, capture how peers’ predetermined characteristics influence a student’s outcomes independent of their actual behaviors. In our setting, the key regressor capturing contextual peer effects is roommates’ precollege game usage, which may reflect traits such as motivation, attitudes toward academics, or established study habits.

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