Do university policies matter? Effects of Course Policies on Performance

We benefit from the Bologna reform to show how course and program policies affect academic achievement. We examine two similar programs at the business school of a major European university, which were both reformed. Time lags in the reforms allow us to estimate the difference in the differences of student performance in a compulsory second-year course. Performance fell as the impact of the course on the graduation certificate decreased and the time until students received the certificate increased. More students failed as they were allowed to resit the exam more often. Both effects depend on ability. We conclude that program policies matter and universities should be aware of their effects.