Class Rank Matters

People who are the top of their class in elementary school have better outcomes in school than people at the bottom, even compared to people of equal academic ability in absolute terms with a lower (higher) class rank.

From a practical perspective, this means you are better off starting you kids in school later rather than early, if you have a choice, because they will be more mature relative to other kids in their primary school classes.

This paper establishes a new fact about educational production: ordinal academic rank during primary school has long-run impacts that are independent from underlying ability. Using data on the universe of English school students, we exploit naturally occurring differences in achievement distributions across primary school classes to estimate the impact of class rank conditional on relative achievement. We find large effects on test scores, confidence and subject choice during secondary school, where students have a new set of peers and teachers who are unaware of the students’ prior ranking. The effects are especially large for boys, contributing to an observed gender gap in end-of-high school STEM subject choices. Using a basic model of student effort allocation across subjects, we derive and test a hypothesis to distinguish between learning and non-cognitive skills mechanisms and find support for the latter.

Richard Murphy, Felix Weinhardt, "Top of the Class: The Importance of Ordinal Rank" NBER Working Paper No. 24958 (Issued in August 2018).