tests: general science for natural sciences students and social science for those in the social science stream. After the reform, the structure of the stream specific tests changed significantly, with general science split into physics, chemistry, and biology and social science split into geography, history, and economics. Consequently, students in the natural science stream now take physics, chemistry, and biology, while those in the social science stream are tested in history, geography, and economics. Students from both streams continue to take english, mathematics, civics, and an aptitude exam. Each of these exams is scored out of 100 points.

We utilize data from the Ministry of Education, spanning 17 years between 2003 and 2019. The dataset comprises 2.47 million individuals who took the national high stakes exam, the Ethiopian Higher Education Entrance Certificate Examination (EHEECE).<sup>8</sup> The EHEECE tests are highly standardized and administered in a relatively controlled environment. Typically, the exams are administered in June or July at students’ schools of enrollment. They follow a uniform schedule across Ethiopia, with tests for each subject administered simultaneously on the same date and time. The exams’ timetable is arranged over consecutive days with two testing slots on each day – one in the morning and another in the afternoon. On some days, students from different streams take stream specific subject exams in a single slot. To minimize the possibility of cheating, test invigilators are assigned to schools other than their own.

The passing cut-off for public universities varies by gender, region, and stream. For example, in the 2021/22 academic year, the passing grade for natural science students was 363 for males and 351 for females. For students from rural areas, the cut-off grades were slightly lower, at 351 for males and 339 for females. Additionally, private universities generally have lower cut-offs compared to public universities.<sup>9</sup> Students who fail the exams are allowed to retake them once, but the passing mark for retakes is set higher.

Our sample is restricted to school-going students below the age of 21 and those who have completed the required number of exams. We do not include those students who are re-taking the exams. This results in a sample of 2.13 million test-takers. To account for changes in exam structure and passing requirement over time, we standardize the test scores at the year and stream level<sup>10</sup> . The standardisation is done at the stream level because the distribution of scores differs based on stream, as does the passing score. The exam questions are multiple choice and require students to fill out their answers in an Optical Mark Recognition (OMR) sheet. Anonymity of students is maintained through roll numbers, which reduces the chances of manipulation of grades. Further, the passing 8The EHEECE was previously called the Ethiopian School Leaving Certificate Examination (ESLCE) until 2003 before it was replaced by the Ethiopian Higher Education Entrance Certificate Examination (EHEECE), which has since been renamed Ethiopian University Entrance Exam (EUEE) in 2021.

> 9Private higher education in Ethiopia is a relatively recent development, with the enrollment of students in private universities and colleges beginning at the turn of the century. As a result, there is a prevailing perception that the quality of education offered by these private institutions is somewhat inferior. There is, thus, greater competition to join public universities, which may explain the disparity in the passing grades required for entry into public versus private higher education institutions.

> 10To understand the distribution of average scores by region, refer to Figure A3 in the Online Appendix. It provides a map of the average score by geographic location.

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