Automatic grade promotion and student performance: Evidence from Brazil

This paper examines the effect of automatic grade promotion on academic achievement in 1993 public primary schools in Brazil. A difference-in-differences approach that exploits variation over time and across schools in the grade promotion regime allows the identification of the treatment effect of automatic promotion. I find a negative and significant effect of about 7% of a standard deviation on math test scores. I provide evidence in support of the interpretation of the estimates as a disincentive effect of automatic promotion. The findings contribute to the understanding of retention policies by focussing on the ex-ante effect of repetition and are important for more complete cost-benefit considerations of grade retention. © 2013 Elsevier B.V.