Threat of grade retention, remedial education and students achievement: evidence from upper secondary schools in Italy

We use a reform in Italy to investigate the effects on academic achievement of more stringent requirements for grade progression at secondary school. Geographic discontinuities in the implementation enable comparison among similar students undergoing alternative progression rules. We find different short-term results across curricular tracks, with negative effects of the increased threat of grade retention for students in technical and vocational schools. In contrast with the effects on academic achievement, we find that schools reacted to the additional administrative burden and costs imposed by the reform by admitting more students to the next grade. We argue that the reform had a negative effect on the motivation and engagement of the students who experienced the greatest difficulties, exacerbating inequalities.