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Long-Run Effects of Selective Schools on Educational and Labor Market Outcomes

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Listed:
  • Kanninen, Ohto
  • Kortelainen, Mika
  • Tervonen, Lassi

Abstract

This paper analyzes the effects of selective schools on students’ educational and labor market outcomes. We utilize regression discontinuity design based on the centralized admission system of upper secondary schools in Finland to obtain quasi-random variation for selective high school offers and attendance. By using nationwide administrative data, we first show that the selective schools do not improve high school exit exam scores, even though there is a large jump in peer quality for students attending selective schools. Despite lacking short-term effects, we find that selective schools increase university enrollment and graduation in the long run. Yet, we do not observe positive effects on income. Importantly, our results suggest that selective high schools or better peer groups do not improve students’ human capital or skills, but affect their preferences on educational choices after the secondary school.

Suggested Citation

  • Kanninen, Ohto & Kortelainen, Mika & Tervonen, Lassi, 2023. "Long-Run Effects of Selective Schools on Educational and Labor Market Outcomes," Working Papers 161, VATT Institute for Economic Research.
    • Handle: RePEc:fer:wpaper:161
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    References listed on IDEAS

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    1. Leonardo Bursztyn & Robert Jensen, 2015. "How Does Peer Pressure Affect Educational Investments?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 130(3), pages 1329-1367.
    2. Will Dobbie & Roland G. Fryer Jr., 2014. "The Impact of Attending a School with High-Achieving Peers: Evidence from the New York City Exam Schools," American Economic Journal: Applied Economics, American Economic Association, vol. 6(3), pages 58-75, July.
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    JEL classification:

    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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