CEPS Education Markets Workshop 2022

15 June 2022 – Vicky Jackson

We were delighted to host the Bristol Education Markets Workshop at Clifton Hill House on 6 and 7 June under the CEPS Education research programme. One of the organisers – Hans Sievertsen – explains why CEPS works on what we call ‘education markets’ – 

“We often think of markets as a place where we buy and sell things for money. But in some markets, money is not directly involved, and allocations are instead based on a set of rules. One example is allocation to schools. Often, parents provide a list of desired schools for their children and a centralised system then allocates children based on some pre-defined criteria, such as distance to the school or prior attainment. In some countries, such as France and Italy, teachers are allocated to schools in the same way. There are many details in the design of these systems that affect who ends up going to which school, and since we know that the school we attend and the teachers we have are important for how well we do later in life, it is of great policy importance to get the design of these systems right.” 

The workshop examined policies using market mechanisms in education, including design and implementation and their impact on school and university allocation in different countries. Sessions covered policy design and school choice in practice, and research on allocation mechanisms, how schools prioritise among students and implications for lower-income households and across genders.

In the first session on School Choice in Practice, Mille Bjørk from the Danish Ministry of Children and Education outlined the new Danish model for allocating high-school students to schools. The priorities for the new system are 1) to counteract ethnic and socio-economic segregation across schools, particularly in urban areas where the population distribution is more polarised, and 2) maintaining a sustainable number of students in rural schools. Emily Hunt from the Education Policy Institute presented a personal account of the experience of navigating the complexities of the English school allocation process during a pandemic. Reconciling her own experience as a parent with the evidence on school choice, she found the current school choice system favours more affluent families who are better able to navigate the system, potentially working against the government’s aim to ‘support the most disadvantaged’ and ‘level-up education standards’. 

In the second session on Design, Éva Holb (Institute of Economics, KRTK, Hungary) explored the centralised secondary school admission system in Hungary, outlining its (relatively complex) design and the implications for student choice and outcomes. Aytek Erdil from the University of Cambridge spoke on widening access and managing recruitment in university admissions. He outlined a model, developed with Battal Doğan (Bristol) for a centralised system which could be implemented after school-leaving qualifications are known.  

The final session on day one focussed on Income. Andreas Bjerre-Nielsen from the University of Copenhagen investigated why students submitted preferences for educational programs that differed from what they actually wanted to study. Using Danish admissions to higher education he examined how non-truthful reporting is linked to misguided beliefs about admission chances and to students’ backgrounds. Jose Montalban (SOFI at Stockholm University) examined the impact of low-income household priority policies on school choice and on student outcomes, asking whether these policies are effective in practice at improving outcomes for students from disadvantaged backgrounds. His paper used school choice in Madrid as a case study and tested the effect of income-based priority points on parental school choice, parental application behaviours and academic and non-academic student outcomes. 

The second day began with papers centered on Priorities. Peter Biro of the Institute of Economics, KRTK Hungary, discussed school choice with and without priorities. He looked at two case studies using non-standard school choice mechanisms. The first was Estonian kindergarten allocation where a ‘deferred acceptance’ mechanism is in use with different priorities and the second, school choice in Sweden where priorities are not used and instead a new concept of ‘constrained welfare-maximising assignment’ is employed. Julien Grenet (Paris School of Economics) looked at the effects of affirmative action on targeted and non-targeted students through a study of Paris high schools following a policy change in admission rules that gave low-income students priority over other district students.  

In a session on Gender, Caterina Calsamiglia (ICREA at the Institute of Political Economy and Governance) undertook a comprehensive evaluation of a policy change in Spain in 2010 which increased the weight of standardised exam results for university admissions from 40% to 60% and its implications for the gender gap. Soledad Giardili from the University of Edinburgh presented her paper “Single-Sex Primary Schools and Student Achievement: Evidence from Admission Lotteries” asking whether single-sex schools provided the benefits they are assumed to deliver, such as improving academic achievement and achieving gender equality. Soledad used the setting primary school allocation in Malta to explore this question, finding a positive effect on academic and non-academic factors for boys and girls. 

The workshop concluded with a session on Choice and Access. Damon Clark from UC Irvine asked how parents choose schools. He collected new survey data from parents as they choose schools, focussing on the impact of parents’ beliefs about their own child and about the wider local population on their choices. Lykke S. Christensens (University of Copenhagen) paper “Playing the system: Address Manipulation and Access to Education” studies address moves of students in Denmark, where proximity to a school is key in the allocation of places. Lykke and colleagues identified a 100% increase in the number of address changes around high school choice deadlines. She considered the implications for access to education, finding the increase in address changes is driven by high socio-economic status applicants to the 15% most popular schools. Low socio-economic status students lose out as a result in terms of contact with higher achieving peers. These results have implications for modelling school choice mechanisms and policy effectiveness.  

The last presentation from Ellen Greaves (University of Bristol) asked how schools shape neighbourhoods.  That is – how do schools’ admissions priorities affect households’ residential moves and how does this vary across different types of households? To examine these questions, she compared household location choices in local authority areas with a geographical admission priority against those with a non-geographic priority system, i.e. grammar school systems which concentrate on academic achievement. 

We had fantastic research presented at the workshop and the opportunity to discuss in person following two years of virtual events was hugely beneficial. Mille Bjørk from the Danish Ministry of Children and Education said of the event: 

“I really enjoyed the workshop. In the ministry we always aim to consider the research evidence when designing new policies. Interacting with the researchers at this workshop was really valuable, and I’ve built connections that will be helpful in the future.

Thank you to all our presenters and attendees for making the event so productive and enjoyable. If you would like to learn more about the event, please see the programme.

Genes and Upbringing Both Matter for Educational Success


Stephanie von Hinke and Michelle Kilfoyle

Nature vs. nurture is an age-old debate. Are we products of our genes or of how we were raised? It is now widely accepted that both genes and environment are inextricably linked and jointly mould our lives. A recent study of siblings and their educational achievements provides evidence to further bolster this joint gene-environment theory. It finds that eldest siblings, typically blessed with extra attention from their parents, do especially well in education when they also possess certain genetic traits.

Firstborn children have the luxury of their parents’ undivided attention until the arrival of their younger siblings. In fact, firstborns can expect to have, on average, 20-30 minutes more daily quality time with their parents than laterborns, as parents find their time increasingly stretched with each child.

This privilege goes a long way in explaining why eldest siblings tend to do better at school than their younger siblings and can be seen as a form of investment by parents in their child’s future. However, it is not always the full story, as the study co-authored by Stephanie von Hinke of the University of Bristol’s Centre for Evidence-based Public Services (CEPS) in the School of Economics shows.

In an innovative step for economics, von Hinke and collaborators from Erasmus University Rotterdam used genetic data to help understand why some people do better than others in education. They analysed DNA from UK Biobank, a national repository of biological samples and individual data, for a sample of 14,850 adult siblings (aged 40-69 at the time of study).

They measured each sibling’s ‘genetic endowment’ for educational attainment using ‘polygenic scores’. These scores are based on specific genetic variants that correlate with educational attainment.

By comparing siblings from the same family, the researchers were able to cancel out the effects of factors like parental income and social class on children’s educational attainment. (It would be much more difficult to disentangle these wealth and class-derived influences from other non-genetic factors when comparing children from different families.)

Each family was akin to a controlled experiment that allowed the researchers to explore the relative influence of each child’s genetic variation and their environment. In this study, being firstborn or laterborn was used as a measure of a child’s environment as it, at least partly, indicates whether parents invested more or less time in each child.

The results first confirmed that genetic variations are very good at predicting educational attainment. In general, the higher a person’s genetic endowment, the more years they had spent in education. Firstborns were no more or less likely to have a high endowment than laterborns.

Second, the results confirmed that firstborns do better at school. Firstborns with an average genetic endowment completed, on average, an extra 4.5 months of schooling than their laterborn siblings.

However, firstborns who have an above-average genetic endowment completed, on average, an additional two months of education (on top of the 4.5 months) than their laterborn siblings with the same genetic endowment.

This study shows that neither genetics nor environment are solely responsible for determining our education, and that both matter. Furthermore, as well as emphasising the importance of investing in skills early in life, the research supports the idea of ‘dynamic complementarity’ between nature and nurture in this setting, that is the idea that people with higher initial skills benefit more from subsequent investment.

Professor Stephanie von Hinke – Professor of Economics, University of Bristol School of Economics
Michelle Kilfoyle – CEPS Science Writer

Escalating Tuition Fees in England Have Not Made Poorer Students Less Likely to Go to University

Stephanie Simion and Michelle Kilfoyle
9 December 2021

Recent UK government proposals to reform higher-education funding, under which graduates would start repaying their student loans on lower salaries, have triggered concerns around disproportionate and negative effects on lower earners. A recent study has assessed the impacts of past changes to higher-education funding for students from different income groups in England. It finds that price hikes to tuition fees in 2006 and 2012 have not led to fewer poorer students going to university due to financial support in the form of loans and grants.

In fact, it is students from wealthier families, who are less likely to be eligible for financial support, who are now slightly less likely to enrol. The reforms also appear to have had only very small effects on students’ choices of degree subject and university location, and on their short-term career prospects.

Rising tuition fees

Many countries are considering reforms to higher-education funding. England has had three major reforms in recent decades, beginning in 1998 with a switch from no fees to means-tested fees of up to £1,000 per year.

This was followed by a rapid series of changes which now see England’s students paying among the highest undergraduate tuition fees in the world at up to £9,250 a year. Only students at private universities in the US pay more.

The financial burden of tuition fees naturally raises concerns that students from poorer backgrounds will be deterred from going to university.

Socio-economic consequences The new study, by Stefania Simion of the University of Bristol’s Centre for Evidence-based Public Services (CEPS) in the School of Economics, in collaboration with Ghazala Azmat of Sciences Po in France, unpicked rich datasets to better understand the consequences of different methods for financing higher education.

The researchers assessed enrolment rates, choice of university and subject, and post-university outcomes for students who entered higher education in England between 2004 and 2013, using data on all state-school educated students – around 2.8million individuals.

Their analysis revealed the effects of the increase in fees to £3,000 per year in 2006 (up from a maximum of£1,000, depending on family income), and the short-term effects of the 2012 reform which raised fees to their present maximum level of £9,250.

Enrolment rates and financial support

Enrolment rates across all students fell slightly, by 0.5 percentage points, after the 2006 reform, and again in the year following the 2012 reform. However, this drop was largely among students from wealthier families, classed by this study as those with an average household income of £43,000 or more.

Changes in enrolment rates for students from poorer families (with an average household income of £29,000 or less) and middle-income families (average household income of £34,000) were negligible.

These results can be explained by the financial support packages that accompanied the increases in fees.

Notably, since 2006, students in England do not have to pay fees upfront but can instead take out a loan to cover the cost. They repay this with interest over their working lives and only once their salary passes a certain threshold, currently £27,295 for those who took out a loan after 2012, or £19,895 pre-2012.

On top of this, means-tested grants of up to £2,700 were introduced in 2006 (up from £949) rising to £3,250 in 2012, plus means-tested loans of up to £4,000 in 2006, and £5,200 in 2012.

This package eases the financial burden of fees, but also means that higher education is relatively more costly for students from families who do not receive means-tested support, potentially explaining the slight drop in student numbers from higher socio-economic backgrounds.

The study calculates that an increase in fees of £1,000 for wealthy students not eligible for grants corresponded to a drop in enrolment of only around 0.025 percentage points. But there was an 0.8 percentage point increase in enrolment among students who were eligible for full financial aid.

Degree subject, university location and career outcomes

The higher cost for wealthier students may also explain why the study found that they were more likely to choose a university close to home after the reforms. It may also explain a slight shift in subject choices. Post-reform, wealthier students were slightly less likely to opt for degrees in Arts and Education programmes, preferring STEM subjects that offer higher-paid careers.

These choices could translate into different career outcomes for wealthier students. Six months after graduating, they had marginally higher earnings and they were also less likely to be unemployed or in insecure work than graduates from less well-off backgrounds compared with the pre-reform period. However, average earnings for middle and low-income groups fell slightly after the reforms.

Closing the socio-economic gap in higher education

In sum, the results show that the funding reforms have had only very small effects on higher education choices, but do suggest that the socio-economic gap in university enrolment is narrowing.

The study’s authors recommend a deeper look at the data to understand if more could be done to promote university to students from the poorest backgrounds, with family incomes far below the £29,000 threshold used in this study

Dr Stefania Simion – Lecturer at University of Bristol, School of Economics

Michelle Kilfoyle – CEPS Science Writer

Study Reveals How High-Stakes Tests Spur Girls to Study Harder

Michelle Kilfoyle and Hans Sievertsen
3rd November 2021

A-level results day this summer once again put grading systems under the spotlight in the UK, reigniting public debate on the potential need for grading reform.

Recent research from the University of Bristol’s Centre for Evidence-based Public Services (CEPS) and School of Economics, conducted in collaboration with the Danish Center for Social Science Research (VIVE), provides key information on the value of such high-stakes grades for students, and the possible effects of changes to grading systems.

In 2007, Danish high schools took the unusual step of re-coding students’ exam results for the previous year as part of a national educational reform. Consequently, while some of these students were awarded a higher Grade Point Average (GPA), a score that is critical to university applications, others saw their GPA fall.

The study took this unique opportunity to explore how grades affect student motivation. It showed that first-year high-school students ramped up their efforts in response to downgraded GPAs and, following this, were more likely to go to university. This was especially true for girls.

Knowing what motivates students to put more effort into their studies not only helps address under-performance. It can also help tackle social inequalities by identifying effective incentives for students whose parents have fewer means or resources than more advantaged families to promote their children’s performance at school.

Other studies on this topic have shown that financial rewards, such as vouchers, encourage students to work harder. Surprisingly, although grades are a more obvious form of ‘reward’, their effects on student behaviour are little researched and often overlooked in policy discussions.

This new study, conducted by  Hans Sievertsen of CEPS and Ulrik Hvidman of VIVE, provides strong real-world evidence that grades do provide an incentive for study. While, intuitively, this may seem apparent, it is particularly hard to prove in practice.

Sievertsen and Hvidman analysed the grades of 26,759 high-school students whose first-year exams had been re-scored under the Danish Grading Reform of 2007.

Introduced by the Ministry of Education as part of efforts to align Denmark’s education system with those of other European countries, the new grading system for secondary and post-secondary schools worked on a 7-point scale, in contrast to the previous 10-point method.

Examiners, thus, had fewer grades to select from, meaning that work graded ‘9’ under the 10-point system, for instance, received ‘7’ under the new system. The new mark did not represent a re-evaluation of the student’s ability; it was purely a re-coding with both grades indicating the same level of performance.

Some students benefited from this complex re-coding scheme, and received a higher GPA, the score that shows a student’s average grade across all courses and which carries high stakes given its use in university admissions processes. However, others lost out and scored lower GPAs. For many students their GPA represents a passport to their post-school education and career of choice, and so potentially shapes their lifelong earnings.

The re-coding, therefore, raised big questions of how students would behave in response to the shock of being downgraded for the remainder of their schooling.

The analysis revealed that downgraded first-year students performed better in subsequent assessments. Those who were downgraded by one standard deviation (approximately one grade point) scored 8% of a standard deviation higher in second- and third-year assessments, which also carry greater weight towards final GPAs. This suggests that these students had upped their effort levels to meet a ‘target’ GPA.

High-achieving students (those with above average GPAs) and, perhaps surprisingly, girls made the greatest leaps in effort.  Girls nearly cancelled out the effect of downgrading through increased efforts – making up 95% of the lost score, on average – compared with just 37% for boys. This may be partly explained by girls’ higher levels of non-cognitive skills, such as being more forward-looking in life.

The study brings new insights into the gendered effects of grades as incentives, while also showing that the relatively ‘small’ solution of placing more emphasis on high-stakes grades could be very effective in raising student performance and ambitions. This is likely to be true for other countries that rely on post-secondary assessment for university enrollment, such as the US and countries across Europe.


Michelle Kilfoyle – CEPS Science Writer
Hans Sievertsen – Professor of Economics, University of Bristol