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Grade Retention and Unobserved Heterogeneity

Author

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  • Robert J. Gary-Bobo
  • Marion Gousse
  • Jean-Marc Robin

Abstract

We study the treatment effect of grade retention, using a panel of French junior highschool students, taking unobserved heterogeneity and the endogeneity of grade repetitions into account. We specify a multi-stage model of human-capital accumulation with a finite number of types representing unobserved individual characteristics. Class-size and latent student-performance indices are assumed to follow finite mixtures of normal distributions. Grade retention may increase or decrease the student’s knowledge capital in a type-dependent way. Our estimation results show that the Average Treatment effect on the Treated (ATT) of grade retention on test scores is small but positive at the end of grade 9. The ATT of grade retention is higher for the weakest students. We also show that class size is endogenous and tends to increase with unobserved student ability. The Average Treatment Effect (ATE) of grade retention is negative, again with the exception of the weakest group of students. Grade repetitions reduce the probability of access to grade 9 of all student types.

Suggested Citation

  • Robert J. Gary-Bobo & Marion Gousse & Jean-Marc Robin, 2014. "Grade Retention and Unobserved Heterogeneity," CESifo Working Paper Series 4846, CESifo.
    • Handle: RePEc:ces:ceswps:_4846
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    References listed on IDEAS

    as
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    Citations

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    Cited by:

    1. Carmen Aina & Francesco Pastore, 2020. "Delayed Graduation and Overeducation in Italy: A Test of the Human Capital Model Versus the Screening Hypothesis," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 152(2), pages 533-553, November.
    2. Léonard Moulin, 2023. "Do private schools increase academic achievement? Evidence from France," Education Economics, Taylor & Francis Journals, vol. 31(2), pages 247-274, March.
    3. Oliver Cassagneau-Francis, 2022. "Revisiting the Returns to Higher Education: Heterogeneity by Cognitive and Non-Cognitive Abilities," SciencePo Working papers Main hal-04067399, HAL.
    4. Javier Valbuena & Mauro Mediavilla & Álvaro Choi & María Gil, 2021. "Effects Of Grade Retention Policies: A Literature Review Of Empirical Studies Applying Causal Inference," Journal of Economic Surveys, Wiley Blackwell, vol. 35(2), pages 408-451, April.
    5. Asma Benhenda, 2018. "What is the cost of grade retention?," DoQSS Working Papers 18-07, Quantitative Social Science - UCL Social Research Institute, University College London.
    6. Bach, Maximilian, 2019. "Strategic grade retention," ZEW Discussion Papers 19-059, ZEW - Leibniz Centre for European Economic Research.
    7. Emilio Borghesan & Hugo Reis & Petra E. Todd, 2022. "Learning Through Repetition? A Dynamic Evaluation of Grade Retention in Portugal," PIER Working Paper Archive 22-030, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    8. Zhang, Shiying & Huang, Ao, 2022. "The long-term effects of automatic grade promotion on child development," China Economic Review, Elsevier, vol. 74(C).
    9. Jane Cooley Fruehwirth & Salvador Navarro & Yuya Takahashi, 2016. "How the Timing of Grade Retention Affects Outcomes: Identification and Estimation of Time-Varying Treatment Effects," Journal of Labor Economics, University of Chicago Press, vol. 34(4), pages 979-1021.
    10. Hugo Reis & Manuel Coutinho Pereira, 2014. "Grade retention during basic education in Portugal: determinants and impact on student achievement," Economic Bulletin and Financial Stability Report Articles and Banco de Portugal Economic Studies, Banco de Portugal, Economics and Research Department.

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    More about this item

    Keywords

    secondary education; grade retention; unobserved heterogeneity; finite mixtures of normal distributions; treatment effects; class-size effects;
    All these keywords.

    JEL classification:

    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General

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