It builds substance - citation neded. It seems like it could just as easily build insecurity, resentment, etc.

Speaking from experience, I can tell you that I know a lot more than any of my peers (I'm 16), and practically all of that is due to the reading I did and am still doing. That reading was a direct result of my isolation and would likely not have occurred had I been more socially accepted. I should add that I have never once felt resentment or insecurity due to this, though I have developed a slight sense of superiority. (That last part is something I am working to fix.)

Reading a ton as a teen was very helpful to me also, but I think I would have still done it if I had a rich social life of people who were also smart and enjoyed reading. Ultimately being around peers who challenge me is more motivating than being isolated; I don't want to be the one dragging behind.

I do feel that I had to learn a fair amount of basic social skills through deliberately watching and taking apart, rather than just learning through doing--making me somewhat the social equivalent of someone who has learned a foreign language through study rather than by growing up a native speaker; I have the pattern of strengths and weaknesses associated with the different approach.