A Signal of (Train)Ability? Grade Repetition and Hiring Chances
27 Pages Posted: 29 Jul 2020 Last revised: 8 Jun 2022
This article contributes to the nascent literature on the effect of grade retention in school on later labour market success. A field experiment is conducted to rule out the endogeneity of both outcomes. More concretely, various treatments of grade retention are randomly assigned to fictitious rÃÆÃÂ©sumÃÆÃÂ©s sent in application to real vacancies. Overall, grade retention does not significantly affect positive call-back by employers. However, when narrowing in on vacancies for occupations where on-the-job training is important, job candidates with a record of grade retention are 16% less likely to receive a positive reaction. This finding is consistent with Queuing theory.
Keywords: queuing, training, hiring youth, grade retention, signalling
JEL Classification: I21, J23, J70, C93
Suggested Citation: Suggested Citation