When economic agents make decisions on the basis of an information set containing both a continuous variable and a discrete signal based on that variable, theory suggests that the signal should have no bearing on behavior conditional on the variable itself. Numerous empirical studies, many based...

We use administrative data on North Carolina public schools to document the tendency for more highly qualified teachers to be matched with more advantaged students, and we measure the bias this pattern generates in estimates of the impacts of various teacher qualifications on student...