Working Paper

University of Cape Town

The release of the National Income Dynamics Study Wave 2 provides the first nationally representative longitudinal data collected in South Africa. This makes it possible to study transitions in and out of school, across grades and into work in ways not previously possible. We illustrate the high levels of grade repetition evident in South African schools and show how school completion presents a significant hurdle with very few youth successfully completing matric. Exit from school does not offer any advantages as most youth find themselves idle once they have left school. Our regression analysis investigates correlates of school dropout and shows that not keeping pace is a key determinant of school dropout, even after controlling for school quality and socioeconomic status. Those behind but attending higher quality schools are partially protected from dropping out. Some evidence that credit constraints may be related to dropout is found, especially among males.