Working Paper

Prior Knowledge, Module Design, and Student Dropout in Online K-12 Education

Abstract: We examine student dropout in online K-12 education coursework using administrative data for 442,000 students, 64 economics and personal finance modules, and 2.1 million module assignments between 2014 and 2025. We find that module length, prior knowledge, embedded formative assessments, and school district demographics independently predict whether students complete assigned modules. Each additional page is associated with a 0.24-percentage-point decrease in completion probability, but this relationship is 30 percent weaker for students with above-median prior knowledge. Embedded knowledge checks amplify the negative effect of module length: the page effect more than doubles in modules containing these assessments. Dropout is elevated 33 percent above expected on pages immediately before knowledge checks. Districts with higher minority enrollment exhibit lower completion even after accounting for per-pupil expenditure and staffing. Survival analysis reveals that dropout risk is highest in the first 10 percent of module progress and generally declines thereafter, suggesting that early engagement is critical. Apparent differences between personal finance and economics modules disappear within schools, indicating institutional sorting rather than subject difficulty. These findings provide actionable guidance for instructional designers developing online educational content.

JEL Classification: I21; I24; A20; A21;

https://doi.org/10.20955/wp.2026.008

Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Working Papers

Publication Date: 2026-04-30

Number: 2026-008