A study examined the cost effectiveness of a summer school for failed first grade students and the long-term effects of first grade reading failure on reading achievement. Subjects, 361 students who were enrolled in the Cincinnati Public Schools' first grade in 1981, were given the California Achievement Test. Students who failed were denied promotion and attended a summer school where they subsequently scored high enough to be promoted. Scores for those students denied promotion to second grade were compared to students who did not fail, and the cost of the summer school and the savings as a result of promotions at the end of summer were estimated. Results indicated that the students denied promotion scored significantly better than those who did not, but that the difference all but disappeared after one year. Results of the cost-effectiveness calculation indicated that the summer school program was not cost effective. (Three tables of data are included.) (RS)