The unintended consequences of standardized test performance labeling on students' educational investment decisions

State-based standardized testing is used widely both for school accountability and as a graduation requirement. In this thesis, using a quasi-experimental regression-discontinuity design, I draw causal inferences about the unintended consequences of such policies for Massachusetts students. On these tests, Massachusetts divides a continuous measure of student performance (the test score) into several categories (i.e., "Advanced", "Proficient", "Needs Improvement", or "Failing"). I explore whether the classifications that students receive affect their subsequent educational attainments. I examine the effects of labeling in two different testing regimes: (1) the state's high-stakes exit-examination system, which features tests that students must pass in order to graduate from high school, and (2) state tests that are used to hold schools and districts accountable but carry no official consequences for students. Across the board, I find that these labels matter: earning a better label improves the subsequent educational attainments of students who have essentially equal proficiency near the cutoff. In this thesis, I present evidence about performance labeling in three separate papers.