The effect of multigrade classes on cognitive and non- cognitive skills. Causal evidence exploiting minimum class size rules in Italy✰

We analyse how schooling in multigrade classes affects the formation of student cognitive and non-cognitive skills. Our identification strategy is based on some institutional features of the Italian educational system establishing a minimum number of students per class. Classes that do not reach the minimum number of pupils are organized in multigrade classes. In addition, the Italian law also establishes a maximum number of students for multigrade classes, which implies that class size in multigrade classes is very similar to class size in small single grade classes with a number of students just above the minimum size. Using census data on 5th grade Italian students, we find that pupils in multigrade classrooms obtain worse test scores both in literacy and numeracy standardised tests compared to comparable pupils in single grade classroom. While the effect is small and not always statistically significant for the literacy score, we find a large and highly statistically significant effect on the numeracy score. We also find that pupils placed in multigrade classes tend to have a more external centred locus of control. Our results are robust to different specifications including controls for class size and a number of student and school characteristics.