Martin Schlotter (ifo München)
In this paper we estimate the causal effect of preschool attendance on secondary school track choice after primary school using data from the German Socio-Economic Panel (SOEP). In line with previous literature, OLS and Probit models show significant positive associations between preschool attendance and the probability of attending the highest secondary school track. Yet, using a siblings approach and controlling for family fixed effects, returns to preschool become significantly smaller and close to zero. These results are robust to the inclusion of several sibling-specific determinants that might affect within-family differences in both preschool attendance and future track choice. The small effects of preschool might be the consequence of the low-intensity character of German preschools.