SELECTIVE SCHOOL SYSTEMS: Evidence from Germany and implications for the UK debate about grammar schools

Germany has a seemingly rigorous selective education system that ''tracks'' children into three different school types based on ability at the age of 10, quite similar to the old English system. But despite middle-school tracks having very different curricula, peers and teacher quality, there are no long-term effects on completed education, wages and employment for students at the margin between the two tracks, and who were ''quasi-randomly'' allocated into a higher or a lower track.

These are the central findings of research by Christian Dustmann, Patrick Puhani and Uta Schönberg, which is published in the August 2017 issue of the Economic Journal. The reason for this surprising finding is that the system is flexible enough to neutralise initial misallocations of students by later track-reversal through different entry points to the highest track.

The researchers emphasise that this ''re-tracking'' possibility at later stages of the curriculum is a crucial but often overlooked aspect of the German school system, which fully compensates for misallocations of students at earlier stages. This has particular relevance for the current UK debate on the introduction of new grammar schools, where prime minister Theresa May has emphasised the importance of different entry points into the grammar track:

''A modern, meritocratic education system needs to be much more flexible and agile to respond to the needs of every child. So we will demand that new grammars make the most of their freedom to be flexible over how students move between schools, encouraging this to happen at different ages such as 14 and 16 as well as 11.''

The new study uses quasi-random shifts between tracks induced by date of birth to estimate the causal impact of track exposure for students who – in their abilities – are at the margin between two tracks.

• The analysis studies long-term labour market outcomes and educational attainment and finds that for these students, attending a more advanced track in middle school delivers few benefits later in life.

• The authors attribute this to the up- and downgrading of students between tracks that takes place at a later stage of their educational career. They illustrate a substantial amount of movement from the low or medium to the high track at the end of middle school (age 15/16), an upgrading facilitated by the school system. They further demonstrate downgrading at the age of 18/19 through non-enrolment in college or university after graduating from the high track.

• Due to this up-and downgrading, for students who are at the margin between two tracks attending a more advanced track has hardly any impact on the probability of graduating from a medium or high track, completing an apprenticeship or graduating from college or university.

• The findings emphasise a core aspect of the basis on which school systems should be assessed: the built-in possibilities to correct earlier allocations at a stage when more information is revealed about a student''s true potential. In other words, although the young age at which the tracking decision is taken creates particularly large risks for student misallocation, the German system also allows students whose potential has been erroneously assessed to revise the initial track decision at later stages in their educational careers.

The researchers conclude:

''Our findings underscore that built-in flexibilities, along the lines suggested by the UK prime minister, are a key element of German school system that allow students who are initially allocated to a lower track to make up fully for the exposure to a less challenging school environment during middle school.''

''This flexibility may particularly help students from less advantaged backgrounds that need more time to develop their full academic potential.''

''The Long-term Effects of Early Track Choice'' by Christian Dustmann, Patrick Puhani and Uta Schönberg is published in the August 2017 issue of the Economic Journal. Christian Dustmann, and Uta Schönberg are at University College London. Patrick Puhani is at Leibniz Universität Hannover.