During the last decade the responsibility for the education of exceptional children has very rapidly become a function of the public schools. With the inflationary spiral that the economy of the nation has faced during this same period it has become increasingly more difficult for school districts to assume the financial burden that these classes place upon them.

The inclusion of students with disabilities in general education settings has steadily increased since the 1990s. Yet little is known about whether inclusive education is effective for these students or their non-disabled peers. I examine the impacts and associated costs of inclusive education on both student groups through the lens of one anonymous school district that implemented a policy of inclusion as the default student placement in the early 2000s. I leverage the staggered, school-level implementation in an event study model to estimate the policy’s impacts on academic and behavioral outcomes and find there were no detrimental impacts on the academic performance of students with or without disabilities as a result of the policy. Elementary and middle school students’ standardized test scores, as well as attendance rates across all school levels, were unaffected, while high school graduation and 9th grade promotion rates increased by two and six percentage points over the long term. I use a quasi-experimental synthetic control method to examine the associated costs of policy implementation, finding no short- or long-term impacts on district revenue or expenditures. Opportunity costs—a high level of investment required by school and district staff—presented the greatest implementation burden. This study offers evidence that inclusive education does not come at either high financial costs or the expense of students’ academic progress.