@TechReport{iza:izadps:dp11732, author={Obergruber, Natalie and Zierow, Larissa}, title={Students' Behavioural Responses to a Fallback Option: Evidence from Introducing Interim Degrees in German Schools}, year={2018}, month={Aug}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={11732}, url={https://www.iza.org/publications/dp11732}, abstract={Without a school degree, students can have difficulty in the labor market. To improve the lives of upper-secondary school dropouts, German states instituted a school reform that awarded an interim degree to high-track students upon completion of Grade 9. Using retrospective spell data on school and labor market careers from the National Educational Panel Study (NEPS), our difference-in-differences approach exploits the staggered implementation of this reform between 1965 and 1982. As intended, the reform reduced switching between school tracks. Surprisingly, it also increased successful high-track completion, university entrance rates, and later income, arguably by reducing the perceived risk of trying longer in the high-track school.}, keywords={school tracking;school degree;school dropout}, }