We ask if school choice, through its effect on sorting across schools, affects high school graduates’ application decisions to higher education. We exploit a school choice reform that dramatically increased achievement sorting across secondary schools in the municipality of Stockholm, employing a before–after design with a control group of students in similar schools located outside this municipality. The reform had a close to zero mean effect on the propensity to apply for tertiary educational programs, but strongly affected the self-selection by achievement into the kinds of higher educational programs applied for. Low achievers increased their propensity to apply for the ‘low-status’ educational programs, on average destining them to less prestigious, less well-paid occupations, and high achievers increased their propensity to apply for ‘high-status’ educational programs, on average destining them to more prestigious, well-paid occupations. The results suggest that increased sorting across schools reinforces differences across schools and groups in ‘cultures of ambition’. Although these effects translate into relatively small increases in the gender gap, the immigration gap, and the parental education gap in educational choice, our results indicate that school choice, and the increased sorting it leads to, through conformity mechanisms in schools polarizes educational choices of students across achievement groups.

This thesis examines the role of peers when students’ educational decisions are formed. The thesis uses rich administrative data from Sweden, which provides opportunities to follow students over different transitions in their educational career and assess the role of peers in different educational situations. The thesis consists of one introductory chapter and four empirical studies. Study I examines how peers influence each other’s applications to upper secondary education through two different influence functions, where students both conform to their peers’ ambitious decisions and simultaneously can be discouraged from ambitious decisions by high-achieving peers. Study II builds on the findings from Study I and examines if students who conform to their peers’ educational ambitions and enroll in ambitious and demanding educations are more prone to leave such educations since their applications potentially were too myopic when influenced by their peers. Study III examines how students’ decisions to apply to gender typical and gender atypical upper secondary educations were affected by their peers. The study additionally examines if students enrolled in atypical educations are more likely to leave the education and if such decisions are mediated by the peer composition in their upper secondary education. Study IV examines how an admission reform to upper secondary education, which increased the sorting of students on achievements, affected application behavior to different tertiary education.

Peers have a paradoxical influence on each other's educational decisions. On one hand, students are prone to conform to each other's ambitious educational decisions and, on the other hand, are discouraged from ambitious decisions when surrounded by successful peers. In this study I examine how peers influence each other's decision to apply to an academic track in upper-secondary education through these two functions of peer influence. The results show that students are more likely to conform to their in-group peers. However, discouraging effects are structured differently, whereby expectations about self- and peer achievement seem to be a mediating factor. This suggests that the point of reference varies with the mechanism mediating interpersonal influence together with characteristics of both peers and egos. The analysis benefits from rich population registers covering 13 full cohorts of Swedish students, facilitating controls for several sources of endogeneity, such as unobserved time-constant school and family effects.

Gender norms are one of the strongest sources of horizontal stratification within education and peers are important mediators of gender norms. Despite vast amounts of research on how educational decisions are stratified by gender there are relatively few studies examining selection and persistence in gender typical and atypical educations at early stages of the educational career. This study examines how peers mediate selection into the most gender stratified educations within the Swedish upper secondary educational system and how peers mediate the decisions to leave such educations early. The study capitalizes on Swedish administrative data covering 12 full cohorts of students applying to and enrolling in upper secondary education 1999-2010. Such unique data allow me to isolate peer influences from parental influences on gendered educational decisions, using same-sex sibling fixed effects. The results suggest that same-sex peers influence each other to make both gender typical and atypical educational decisions, suggesting that norms about appropriate gender roles are formed locally within schools. The results also show that token girls enrolled in male dominated educations are more likely to leave the education early compared to their sisters enrolled in other types of education. While no such differences are found among token boys enrolled in a female dominated education.     

One of the strongest sources of interpersonal influence on educational decisions is generated through conformity between peers. Despite the large literature on conformity and educational decisions, temporal implications of such effects have been overlooked. This study examines if students conform to educational decisions they later regret by analyzing students in transition from lower to upper secondary education in Sweden. More specifically, the probability of leaving a natural science track within a year from enrollment is examined as an effect of conforming to the decisions of peers in the previous educational context. The study uses administrative population data covering all students transitioning from lower to upper secondary education in Sweden from 1999 to 2010. Such unique data also provide opportunities to examine how peer characteristics within the new educational context affect ego’s probability of leaving the track. The findings provide robust support for the expectation that, to some extent, peers alter ego’s educational decisions towards decisions they later regret.