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June 1, 2016

Cluster-Seminar Public Finances and Living Conditions

The effect of compressing secondary schooling on higher education decisions

Date

June 1, 2016
12:30 - 13:30

Location

Eleanor-Dulles-Raum
DIW Berlin im Quartier 110
Room 5.2.010
Mohrenstraße 58
10117 Berlin

Speakers

Vaishali Zambre

The sustainability of social security systems in many European countries is at risk due to population aging. Many suggestions to increase the share of working-age individuals deal with raising the age for full pension eligibility. A fundamental education reform in Germany extends the working life from the other side: A major education reform in Germany reduced the length of the academic high school track from 9 to 8 years, while leaving the number of overall instruction hours unchanged. Accordingly, the fixed number of instruction hours was distributed over fewer years of schooling, such that learning intensity and weekly workload increased. We investigate the consequences of this so-called G8 reform on students’ higher education decisions. Based on a difference-in-differences approach using high-quality, administrative data on all students in Germany, we find that the G8 reform not only resulted in delayed university enrollment, but also decreased general enrollment rates. Moreover, students' study progress in higher education is negatively affected.
Our results imply that the G8 reform leads to a reduction in human capital and that the main goal of reducing age at labor market entry may not be fully achieved. 

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