Abstract
This paper analyzes the impact of a recruitment policy aimed at improving the quality of new teachers. The reform introduced a scholarship to incentivize the enrollment of high-achieving high school graduates in teacher training programs and imposed enrollment restrictions on low-achieving high school graduates. The screening device used to define achievement was the national standardized university entry test. Using rich administrative data, we document that the reform was effective in improving the average test scores of new teachers, especially in public schools. To assess the impact of the reform on teacher quality, we construct teacher value-added (TVA) measures based on standardized test scores of their pupils. We find that the reform led to a significant increase in the TVA of mathematics teachers, equivalent to 30\% of their standard deviation. However, it did not affect the average TVA of Spanish teachers. We show that this heterogeneity can be explained by differences in the correlation of test scores and teacher quality across subjects. Finally, we show that only one-third of the increase in teacher quality can be explained by the change in ability composition, and the remainder can be attributed to beneficial but unintended effects of the reform.