School segregation, student achievement, and educational attainment in Hungary

Using large-scale administrative data from Hungary, we examine the effects of attending a high-poverty school in Grade 8 on academic achievement and later educational attainment, using a matching approach. We find that attending a high-poverty school is negatively associated with reading scores and secondary education attainment, while there is no significant association with math scores. Estimates are negative in the case of higher education enrollment, but their statistical significance depends on model specification. We find suggestive evidence that attending a high-poverty school has a large direct negative effect on educational attainment, over and above the indirect effect through lower test scores. This suggests that the negative effect of high-poverty schools on students' noncognitive skills and later educational choices can be as important as the effect on achievement.