Template-type: ReDif-Paper 1.0 Author-Name: Ferreira Sequeda, Maria Author-workplace-name: Research Centre for Educ and Labour Mark Author-Name: Golsteyn, Bart Author-workplace-name: Macro, International & Labour Economics, RS: GSBE DUHR, RS: GSBE Theme Human Decisions and Policy Design, RS: GSBE Theme Learning and Work Author-Name: Parra Cely, Sergio Author-workplace-name: General Economics 0 (Onderwijs), RS: GSBE DUHR Title: The Effect of Grade Retention on Secondary School Performance: Evidence from a Natural Experiment Abstract: We study the effects of grade retention on secondary school performance by considering a change in Colombia’s educative legislation. In 2010, the rule that forced schools to retain up to a 5% of students was abolished. Exploiting variation in schools’ retention rates in a difference-in-differences framework, we find that retained (marginally non-retained) students improve (decline) their performance on language but not on math test scores. We suggest the school’s position in the retention distribution, and the proportion of inexperienced teachers in the classroom, can be the mechanisms by which the marginally decreasing returns of grade retention are determined. Classification-JEL: i20,i24,j24 Series: GSBE Research Memoranda Creation-Date: 20180618 Number: 018 File-URL: https://cris.maastrichtuniversity.nl/ws/files/26704503/RM18018.pdf File-Format: application/pdf File-Size: 1355250 Handle: Repec:unm:umagsb:2018018 DOI: 10.26481/umagsb.2018018