Cognitive and Non‐Cognitive Impacts of High‐Ability Peers in Early Years

The sorting of students into ability groups is one of the most common, controversial and long‐examined educational practices. Ability grouping also mechanically changes peer groups. We provide novel evidence on the cognitive and non‐cognitive impacts in early years, of being exposed to higher‐ability classroom peers through being assigned to the top within‐class ability group. We exploit panel data from the UK Millennium Cohort Study, which allows us to construct trajectories of the cognitive and non‐cognitive development of children from birth to entry into primary school. The data also record school grouping policies and the specific within‐class group assignment of each child, by subject. We combine these rich data with an instrumental variable design using child‐level variation in group assignment due to month of birth, in order to measure the local average treatment effect (LATE) of being assigned to the highest‐ability peer group. We find that if a marginal student is assigned higher‐ability peers, this significantly reduces their cognitive achievement in mathematics, and has no impact on literacy. There are countervailing impacts on non‐cognitive outcomes for the marginal student assigned higher‐ability peers: although they are more motivated to study and parents respond with an improved home learning environment, these children have more study‐related difficulties and their relations with their peers significantly worsen. These findings have important policy implications for the use and design of within‐class ability grouping in early years.