The book I've heard referred to repeatedly as the source for this is Keeping Track by Jeannie Oakes; I finally got around to reading it because so many teachers and administrators had cited it as "proof" that ability grouping is bad for kids. It's nearly two decades old now, but it was influential in encouraging schools to de-track (i.e. not group kids by perceived ability). I had mixed feelings about it: her argument seems more political than educational, frankly, and doesn't deal much with gifted kids. More recently the refined version I've heard is that ability-grouping is a bad idea...except for gifted children, who need some time with ability-level-peers.
