Semesters or Quarters? The Effect of the Academic Calendar on Postsecondary Graduation Rates

We explore the relationship between academic calendars and graduation rates at postsecondary institutions in the U.S. for the 1991 through 2010 entering cohorts. To date, no work has examined this topic on a large scale. Using panel data from the Integrated Postsecondary Education Data System (IPEDS) – the universe of four-year nonprofit institutions in the U.S. – and leveraging quasi-experimental variation in academic calendars across institutions and years, we show switching from quarters to semesters negatively impacts on-time graduation rates. An event study reveals that the negative effect begins to emerge in the partially treated cohorts but grows larger as cohorts become more fully treated, and remains negative in the post-treatment period. The calendar switch does not affect six-year graduation rates, as the estimates are small in magnitude and indistinguishable from zero. Using administrative transcript data from the Ohio Longitudinal Data Archive, we replicate this analysis at the student-level and investigate several possible mechanisms for the delayed timing of graduation.1 Our findings suggest that students still graduate as a result of the policy but are confronted with the costs – both a direct cost and an opportunity cost – of a delayed graduation. A back of the envelope calculation suggests that the total cost of the policy to students per year of delayed graduation at an average sized university is $1.6 million. Contrary to the goals of the policy, shifting the academic calendar from quarters to semesters is harmful to students. JEL Codes: I2