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In Germany, students are streamed at age ten into an academic or nonacademic track. We demonstrate that the randomly allocated disadvantage of being born just before as opposed to just after the cutoff date for school entry leads to substantially different schooling experiences. Relatively young students are initially only two-thirds as likely to be assigned to the academic track. The possibility to defer tracking to age 12 does not attenuate school-entry age's effect on track attendance. Some mitigation of the effect occurs only at the second time when educational institutions facilitate track modification when students are about age 16. (Contains 12 tables, 2 figures, and 26 footnotes.)

To purchase or authenticate to the full-text of this article, please visit this link: http://dx.doi.org/10.1111/j.1467-9787.2007.00529.x Byline: Thomas Liebig (1), Patrick A. Puhani (2), Alfonso Sousa-Poza (3) Abstract: ABSTRACT. We investigate the relationship between income tax rate variation and internal migration for the unique case of Switzerland, whose system of determining tax rates primarily at the community level results in enough variation to permit analysis of their influence on migration. Specifically, using Swiss census data, we analyze migratory responses to tax rate variations for various groups defined by age, education, and nationality/residence permit. The results suggest that young Swiss college graduates are most sensitive to tax rate differences, but the estimated effects are not large enough to offset the revenue-increasing effect of a rise in tax rate. The migratory responses of foreigners and other age-education groups are even smaller, and reverse causation seems negligible. Author Affiliation: (1)OECD, Directorate for Labour, Employment and Social Affairs, Non-Member Economies and International Migration Division, F- 75775 Paris, France. E-mail:Thomas.Liebig@oecd.org (2)Leibniz University of Hannover, Institut fur Arbeitsokonomik, Konigsworther Platz 1, D-30167 Hannover, Germany; other affiliation: SIAW, University of St. Gallen, IZA, Bonn. E-mail:Puhani@aoek.uni-hannover.de (3)Faculty of Business, Economics and Social Sciences, University of Hohenheim, Fruwirthstra[sz]e 48, D-70599 Stuttgart, Germany; other affiliation: FAA, University of St. Gallen, IZA, Bonn, Germany. E-mail:Alfonso.Sousa-Poza@uni-hohenheim.de Article History: Received: July 2005; revised: October 2006; accepted: December 2006.

Little is known on the existence of negative relative demand shocks against low-skilled workers on a 'US-style' deregulated labour market with a 'German-style' vocational (apprenticeship) education system. Switzerland provides an appealing testing ground to investigate this question. Traditionally a 'zero unemployment' economy, Switzerland has seen an unprecedented rise in joblessness in the 1990s, although unemployment fell again to a rather low level after 1997. This paper tests whether Switzerland experienced a negative relative demand shock against the low skilled during this period and whether this shock resulted in growing wage dispersion between education groups (like in the US) or in growing unemployment (like in continental Europe). It turns out that only workers with an educational level below apprenticeship were affected by a negative relative demand shock, which speaks in favour of the German-style vocational education system. The Swiss wage structure, however, did not react to the relative demand shock against low-skilled workers without apprenticeship, which resulted in higher relative unemployment for this group.