Despite their egalitarian ethos, schools are social sorting machines, creating categories that serve as the foundation of later life inequalities. In this review, we apply the theory of categorical inequality to education, focusing particularly on contemporary American schools. We discuss the range of categories that schools create, adopt, and reinforce, as well as the mechanisms through which these categories contribute to production of inequalities within schools and beyond. We argue that this categorical inequality frame helps to resolve a fundamental tension in the sociology of education and inequality, shedding light on how schools can—at once—be egalitarian institutions and agents of inequality. By applying the notion of categorical inequality to schools, we provide a set of conceptual tools that can help researchers understand, measure, and evaluate the ways in which schools structure social inequality.


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