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Vincent Tinto (1993) identifies three major sources of student departure: academic difficulties, the inability of individuals to resolve their educational and occupational goals, and their failure to become or remain incorporated in the intellectual and social life of the institution.  Tinto's "Model of Institutional Departure" states that, to persist, students need integration into formal (academic performance) and informal (faculty/staff interactions) academic systems and formal (extracurricular activities) and informal (peer-group interactions) social systems.  

Vincent Tinto's home page contains several good articles on student retention.

Tinto's (1993) Dimensions of Institutional Action

I. Defining "Dropout" from Higher Education

A) Dropout as Individual and Institutional Failure
Institutions should not define dropout in ways which contradict the students' own understanding of their leaving. If the leaver does not define his/her own behavior as representing a form of failure, neither should the institution.

B) Educational Mission
In the course of establishing a retention policy, institutions must not only ascertain the goals and commitments of entering students, they must also discern their own goals and commitments.

II. The Principles of Effective Retention

A) Institutional Commitment to Students
Effective retention programs are committed to the students they serve. They put student welfare ahead of other institutional goals.

B) Educational Commitment
Effective retention programs are first and foremost committed to the education of all, not just some, of their students.

C) Social and Intellectual Community
Effective retention programs are committed to the development of supportive social and educational communities in which all students are integrated as competent members.

III. The Principles of Effective Implementation

A) Institutions should provide resources for program development and incentives for program participation that reach out to faculty and staff alike.

B) Institutions should commit themselves to a long-term process of program development.

C) Institutions should place ownership for institutional change in the hands of those across the campus who have to implement that change.

D) Institutional actions should be coordinated in a collaborative fashion to insure a systematic, campuswide approach to student retention.

E) Institutions should act to insure that faculty and staff possess the skills needed to assist and educate their students.

F) Institutions should frontload their efforts on behalf of student retention.

G) Institutions and programs should continually assess their actions with an eye toward improvement.

Stages of retention

Recruitment and Admission to College
- setting realistic expectations so that the prospective student can choose the appropriate school

Orientation: Bridging the Gap to College
- providing new students with information about the character of institutional life and about the requirements of the academic system that they are entering

Pre-entry Assessment and Placement: Identifying Student Needs
- placing students in appropriate first year courses
- assessing students for counseling and advising purposes

The First Year: Making the Transition to College
- helping students make the social and academic transition to the new and possibly much more challenging life of the college with things such as a first-year experience course (for more information, see the National Resource Center for The First-Year Experience and the Policy Center on the First Year of College)

Types of institutional actions to improve student retention

Transition assistance

Early contact and community building

Academic involvement and support

Monitoring and early warning

Counseling and advising

Effective student retention programs: