Winners and losers: The Impact of School Choice Reform
A new study published in the American Economic Journal: Applied Economics shows that merit-based school admissions can unintentionally widen educational inequalities.
In their article “Pulled In and Crowded Out: Heterogeneous Outcomes of Merit-Based School Choice” (2025), Antonio Dalla-Zuanna, Kai Liu, and Kjell G. Salvanes analyze how a reform in Bergen, Norway’s high school admission system affected students’ outcomes. Before 2005, students attended their local school by default. After the reform, they could rank preferred schools, and admission was determined by middle-school grades.
The authors find that the reform had a small but overall negative effect on educational attainment—measured by high school completion and university enrollment. Yet these average effects mask substantial heterogeneity. High-achieving students who gained access to more competitive schools saw little improvement, whereas those who were displaced or “crowded out” experienced clear setbacks. The results reveal how merit-based admissions can create winners and losers within the same policy framework.
The study concludes that policymakers should look beyond the outcomes of those admitted to prestigious schools when evaluating education reforms. Although merit-based systems may appear fair, they risk deepening inequality if they fail to account for students who lose access or are left behind.