The Impact of Grade Retention on Juvenile Crime

Implementing a fuzzy regression discontinuity design, we estimate a local causal effect of grade retention on juvenile crime. We assemble a novel data set that merges administrative information on schooling and juvenile crime for the entire population of students during the period 2007 – 2014 in Chile. Our main finding shows robust evidence that repeating a grade in school increases the probability of juvenile delinquency by 1.8 percentage points (pp), an increase of 37.5% of that probability. This effect is higher for males, and twice the indicated value for students of low socioeconomic status. We also show that grade retention increases the probability of dropping out of school by 1.5 pp. Regarding mechanisms, our findings suggest that the effect of grade retention on crime does not only manifest itself indirectly as a result of its effect on dropping out. In fact, the effect of grade retention on crime is greater when students switch schools right after failing a grade.