Economics Seminar - Pulled-in and Crowded-out: Heterogeneous Outcomes of Merit-based

We analyze the effects of reforming the high school admission system from a residence based
allocation to a merit-based allocation. The merit-based system generates oversubscribed schools,
which favor high-GPA students at the expense of displacing low-GPA ones. We use the potential
outcomes framework to analyze the effects of the reform, separating the effects for those gaining
access to competitive schools from those losing access and identifying these parameters by using the
reform as an instrument within subpopulations defined by admission cutoffs and GPA. The small
and negative overall effect of the reform hides large negative effects for the crowded-out students.