Abstract

In several countries, students are tracked into secondary school types. This paper studies whether parents or teachers assess students' potential performance more adequately. We evaluate a reform in the German state of North Rhine-Westphalia in 2006. The reform replaced parents' choice about their children's school type by a binding teacher recommendation. The dependent variable is educational attainment measured by grade retention rates. We find that teacher recommendations cause less grade retentions. The effect is mainly driven by students from better situated districts. This finding may capture that with free parental choice, parents select too demanding tracks for their children.