Does Failing a Placement Exam Discourage Underprepared Students from Going to College?

About one third of college students are required to take remedial courses. Assignment to remediation is generally made on the basis of performance on a placement exam. When students are required to take a placement exam prior to enrolling in college-level courses, assignment to remediation may dissuade students from actually going to college. This is because remediation could increase the time required to complete a degree (because remedial courses do not count toward academic degrees), and also because being identified as needing remediation might have stigma effects or provide students with new information about their unsuitability for college. This paper examines this issue empirically using administrative data from Texas. Using regression discontinuity methods, we find that students whose placement exam scores would require them to be in remediation are no less likely to enroll in college than are students who score just above the remediation placement cutoff.