Educational systems and the trade-off between labor market allocation and equality of educational opportunity

Educational systems with a high level of tracking and vocational orientation have been shown to improve the allocation of school-leavers in the labor market. However, tracked educational systems are also known to increase inequality of educational opportunity. This presumed trade-off between equality and labor market preparation is clearly rooted in two different perspectives on the origin of differentiation in educational systems, dating back to the nineteenth century. Tracking was seen both as a way to prepare students for an industrializing labor market and as a way for the elite to formalize social distances in the educational system. We empirically study the trade-off with newly developed country-level indicators for tracking and vocational orientation. Our country-level regressions largely support the existence of the trade-off between labor market allocation and equality of opportunity.