Student Accountability, Exit Exams, and Long-Run Outcomes

Abstract

This paper examines the effects of failing high school exit exams on adult criminal behavior, economic self-sufficiency and several other medium-and long-run outcomes. We employ a unique source of linked administrative data from a Southern U.S. state and leverage the exogenous variation generated by the state’s exit exam policy in a regression discontinuity framework. Our findings indicate that for black students who barely failed the initial exam, adult crime increased by 20 percent compared to black students who barely passed. 1n contrast, the discontinuity estimates for white students are small and statistically insignificant. Further examination reveals that failing to meet the passing cutoff on the exit exam decreased the likelihood of enrollment in subsequent grades and on-time graduation, irrespective of a student’s race. Finally, our results show that failing the exit exam increased the odds of reliance on social programs in adulthood for black students. We propose a mechanism for observed effects and provide evidence consistent with this explanation. Several robustness checks and various placebo tests support our findings.