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A simple model of decentralized graduation standards is presented. It is shown that a school whose students are disadvantaged on the labor market applies less demanding standards because such students have lower ability or less incentives to graduate. The model's predictions are tested using  D utch school‐level data. Since students in the  N etherlands have to participate in both a central and a school specific examination, we can identify the grading policy of individual schools. We find that schools which harbor greater shares of disadvantaged students tend to set lower standards. This association is most pronounced in the track of secondary schooling that prepares for university.

Double Standards in Educational Standards – Do Schools with a Disadvantaged Student Body Grade More Leniently?