REVISITING GRADE RETENTION:

AN EVALUATION OF FLORIDA’S

TEST-BASED PROMOTION POLICY

Jay P. Greene

Department of Education

Reform

University of Arkansas

201 Graduate Education

Building

Fayetteville, AR 72701

Marcus A. Winters

(Korrespondierender Autor)

Department of Economics

University of Arkansas

201 Graduate Education

Building

Fayetteville, AR 72701

winters@uark.edu

Abstrakt
In 2002, Florida adopted a test-based promotion policy
in the third grade in an attempt to end social promo-
tion. Similar policies are currently operating in Texas,
New York City, and Chicago and affect at least 17 Prozent
of public school students nationwide. Using individual-
level data on the universe of public school students in
Florida, we analyze the impact of grade retention on
student proﬁciency in reading one and two years after
the retention decision. We use an instrumental variable
(IV) approach made available by the relatively objective
nature of Florida’s policy. Our ﬁndings suggest that re-
tained students slightly outperformed socially promoted
students in reading in the ﬁrst year after retention, Und
these gains increased substantially in the second year.
Results were robust across two distinct IV comparisons:
an across-year approach comparing students who were
essentially separated by the year in which they hap-
pened to have been born, and a regression discontinuity
Design.

C(cid:1) 2007 American Education Finance Association

319

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REVISITING GRADE RETENTION

EINFÜHRUNG

1.
Several large public school systems have recently adopted test-based promotion
policies for students in particular grades. Under these policies, students are re-
quired to demonstrate a certain level of academic preparation on a standardized
test before they can be promoted to the next grade. There are usually various
exemptions and alternative routes to promotion, but the default outcome un-
der test-based promotion is that students with low test results are retained in
the same grade. The public school systems of Florida, Texas, New York City,
and Chicago now require all students in certain grades to achieve a minimal
level on a standardized reading test in order to earn promotion to the next
grade level. If such policies were to remain in only these school systems, Sie
would affect more than 17 percent of the nation’s public school students.1

While having students repeat a grade has long been a fairly common
üben, the prevailing view among educators has been that it is in the best
academic and social interests of students to advance to the next grade. In
besondere, teachers often believe that retaining a student will harm his or her
self-esteem (Tompchin and Impara 1992; Jacob, Stein, and Roderick 2004).
When students have been retained, it has generally been at the discretion of
teachers in consultation with administrators and parents, and not based on
the results of standardized tests.

Retaining a large population of students has direct and substantial eco-
nomic consequences. If a student successfully completes his or her schooling,
that student will spend (mindestens) an additional year in the public school system
at an average cost to the taxpayer of $9,941 per year.2 Further, by affecting
academic growth and increasing the age at which the child will complete
high school, these policies similarly affect the skills with which students enter
the workforce and the probability that they will earn a high school diploma,
which in turn is related to income (Hungerford and Solon 1987; Belman and
Heywood 1991, 1997; Park 1994; Jaeger and Page 1996).

Proponents of these policies argue that the material taught in a given grade
often assumes the student has a prerequisite knowledge base that was obtained
in the prior grade. Daher, such students might beneﬁt from shoring up their
knowledge of basic material before they attempt the more difﬁcult next grade.
It is also possible that any such effect could grow over time as material becomes
more and more difﬁcult in later grades.

Jedoch, a wide body of existing empirical research suggests that retention
in fact harms later academic progress (Peterson, DeGracie, and Ayabe 1987;

1. Author calculations using data from National Center for Education Statistics, Digest of Education

Statistics 2005, Tables 33, 90.

2. National Center for Education Statistics, Digest of Education Statistics 2005, Tisch 162.

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Jay P. Greene and Marcus A. Winters

Holmes 1989; Alexander, Entwisle, and Dauber 1994; Jimerson et al. 1997;
Roderick and Nagaoka 2005) and increases rates of students dropping out of
Schule (Grissom and Shepard 1989; Roderick 1994; Jimerson 2001a, 2001B;
Allensworth 2005). But the vast majority of this research is dated and focused
on more subjectively guided retention rather than that driven by standardized
testing.

By signiﬁcantly reducing the subjectivity of retention decisions, test-based
retention policies allow for an instrumental variable approach that was not
available for previous researchers. These policies allow for substantial im-
provements on previous work, which demands a reopening of the empiri-
cal literature. Two previous studies (Jacob and Lefgren 2004; Roderick and
Nagaoka 2005) have used the existence of test-based retention in Chicago to
evaluate the impact of retention in that city.

This study adds to the limited research on the effects of test-based retention
policies on student proﬁciency. We use a rich data set containing individual
information on public school students in the state of Florida from 2002 Zu
2005. We use an instrumental variable approach with two distinct comparison
groups to evaluate the robustness of any ﬁndings. In an across-year approach,
we compare the gains of students who were retained during the ﬁrst year
of the policy with students who achieved the same low test scores but were
not retained because they entered the third grade in the year prior and thus
were not subject to retention. We then use a regression discontinuity approach
similar to that used in the recent evaluations of Chicago’s test-based retention
policy in which we compare the performance of students just above and below
the cutoff for retention during the third-grade year.

The results of these analyses show that retained students in Florida made
signiﬁcant and economically substantial reading gains relative to the control
group of socially promoted students two years after being subjected to the
Politik. These beneﬁts in reading from being retained grew substantially from
the ﬁrst to the second year after retention.

The remainder of this article proceeds as follows: In the next section we
provide a brief overview of previous research on grade retention. We brieﬂy de-
scribe Florida’s policy and then discuss each of our comparison strategies and
report their results independently. Endlich, we conclude with a brief summary
of our results and their implications for future research.

2. PREVIOUS RESEARCH
Several previous studies have evaluated the impact of grade retention on later
student performance prior to the adoption of test-based promotion policies
(Peterson, DeGracie, and Ayabe 1987; Holmes 1989; Alexander, Entwisle, Und

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321

REVISITING GRADE RETENTION

Dauber 1994; Jimerson et al. 1997). Other researchers have focused on the
effect of such policies on the probability that a student graduates from high
Schule (Grissom and Shepard 1989; House 1998; Jimerson 2001a, 2001B;
Roderick 1994; Allensworth 2005). Meta-analyses indicate that the cumulative
ﬁnding of this previous research is that retaining a student leads to substantial
academic harm (Holmes and Matthews 1984; Holmes 1989; Jimerson 2001a).
Jedoch, even relatively recent work on retention was limited by the dif-
ﬁculty of creating adequate groups with which to compare retained students.
Lacking an objective policy, the decision to retain a student is a subjective
judgment made by the teacher or school administrator. Thus most previous
researchers focused on developing instruments based on observed character-
istics. In his review of the research, Jimerson (2001A) reports that of twenty
studies of grade retention in the 1990s, researchers most commonly matched
samples based on some combination of IQ, socio-emotional adjustment,
socioeconomic status (SES), or gender.

Although these observed characteristics were the best available for past
researchers given the subjective nature of retention, their usefulness as in-
struments for retention are theoretically limited. While they clearly affect the
probability that a student is retained, it is difﬁcult to argue that any of the
above characteristics are independent of test score gains. Darüber hinaus, even if
the matched promoted students have test scores, IQs, SES, usw., similar to
those of retained students, the fact that their teachers made opposite decisions
about their promotion implies they may be dissimilar to retained students in
some important way observed by the teacher but unobserved by the researcher.
Daher, though often cited as conclusive, there is legitimate reason to doubt the
usefulness of prior studies on subjective grade retention, and further research
using exogenous instruments for retention is necessary to test the robustness
of these previous results.3

The existence of more objective retention policies across the nation now
provides researchers with an opportunity to create more meaningful groups
with which to compare retained students than were available to researchers
previously. Under the test-based promotion policies, students are much more
likely to be retained if their score on a standardized test is below a certain
threshold. Where previous retention decisions were endogenous to a host of
unobservable factors, researchers can now use student performance relative
to these arbitrarily set but objective cutoff scores as an exogenous instrument
evaluating student performance under retention.

3. Roderick and Nagaoka (2005) provide a more in-depth review of this literature and come to a similar
conclusion about its drawbacks. We defer to their review, given its recentness and our agreement
with their conclusions.

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Jay P. Greene and Marcus A. Winters

Jacob and Lefgren (2004) and Roderick and Nagaoka (2005) used a regres-
sion discontinuity approach to study the impact of test-based promotion in
Chicago. Both articles compared the gains of students whose test scores in the
gateway grade were just above the threshold (most of whom were promoted)
with those of students whose gateway test scores were just below the threshold
(most of whom were retained). Both articles found that retained students made
gains in reading and math after one year, but in the second year of the policy
these gains disappeared in the third grade and were insigniﬁcant to negative
in the sixth grade.

As in Florida, under the policy in Chicago students subject to retention
were also required to attend summer school. In their analysis, Jacob and
Lefgren are able to disentangle the impact of summer school and retention by
taking advantage of the fact that in Chicago summer school students are given
a chance to retake the exam and will avoid retention if they meet the test score
threshold. This creates a new discontinuity separating those who received only
the summer school treatment from those who received the summer school
and retention treatments. In the third grade, their analysis found that after two
years for third-grade students, summer school substantially increased average
reading achievement, and retention had no impact on student achievement.

But the results of the research in Chicago may not generalize to all test-
based promotion policies in other school systems. While both Florida’s and
Chicago’s programs use test-based promotion, differences in the characteris-
tics of the two programs could lead the policies to have different effects. Für
Beispiel, the Chicago program did not have a clear policy permitting exemp-
tions to test-based promotion requirements, while Florida’s did. Perhaps the
restricted but guided discretion of educators’ decisions about retention under
Florida’s test-based policy has signiﬁcant advantages over the unguided policy
in Chicago. Zusätzlich, recent allegations of testing impropriety in Chicago
(Jacob and Levitt 2003) compared with validation of testing integrity in Florida
(Greene, Winters, and Forster 2004; West and Peterson 2005) may produce
different ﬁndings from the Chicago and Florida programs. If Chicago schools
are manipulating test results in response to student retention rather than
addressing the needs of those students, test-based retention may indeed be
counterproductive. The current article contributes to the previous research by
evaluating student performance one and two years after retention in Florida,
using both across-year and discontinuity research designs.

3. FLORIDA’S TEST-BASED PROMOTION POLICY
In 2002 Florida began requiring third-grade students to meet at least
the Level 2 benchmark (the second lowest of ﬁve levels) on the Florida
Comprehensive Assessment Test (FCAT) reading test in order to be promoted

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REVISITING GRADE RETENTION

Tisch 1. Promotion Characteristics: All Students in Third
Grade in 2002–3 with Scores below Test Score Threshold

Exemption for:

No code listed

Limited English proﬁcient

Disability—testing not appropriate

Passed alternative test

Student portfolio

Disability—has received extensive instruction

Already retained twice

No longer enrolled in school system

Academically promoted

Retained

Percent

<1 7 3 8 1 3 12 59 Note: Percentages may not sum to 100 due rounding. to the fourth grade. According state’s testing Web site, students who score at Level 2 are considered have “limited success” with challenging content on test.4 The entering third-grade class of 2002–3 was ﬁrst to be subjected mandate. The legislature allowed for several exemptions retention policy. Ex- emptions were available limited-English-proﬁciency who had less than two years instruction in English; disabled whose individual ed- ucational plan indicated that inappropriate them; who scored above 51st percentile another standardized reading test; students who and received intensive remediation reading; demonstrated proﬁciency through a student portfolio; or who had been retained twice previously. Table 1 shows promotion characteristics the ﬁrst year policy place test scores below and for whom baseline reported our data set. Only 59 percent of subject the necessary threshold actually third table shows that some set coded as having academically promoted without receiving an exemption. After discussions about this Florida warehouse, it remains unclear why these whether there errors their coding. 4. Florida Department Education, “FCAT Explorer: Parent Family Guide.” Available www.fcatexplorer.com>PDF Herunterladen