Students (especially children) often become victims of the shadow effect. When two people compete for the same space the one who seems to have no chance of winning will usually bow out. In guitar this means they will give up. Imagine two siblings learning guitar. As one gets ahead usually by doing more practice the other begins to lose confidence. Overtime the shadow grows and the less progressive students loses confidence and eventually gives up. Many studies have been conducted on this problem but there are also some good possible solutions.
The problem is the student is comparing themselves negatively to a more progressive student. I will usually point out their individual strengths and challenges and encourage them to compete against themselves . I often use the Practice Log as an example. I will ask students to beat their own high score and not to be concerned with other students. Its all about keeping them focused on themselves rather than their siblings or class mates. Faster progress while usually the result of more practice can also be the result of earlier experiences such as learning another instrument, having a strong reason for learning (E.g. a guitar hero) or just listening to more music in general.
When I teach groups of children say five kids all trying to be number 1 may result in one or even 2 winners but it leaves the others feeling crushed. The way to do it is to always talk in terms of team. 1 + 1 = more than 2 so to speak. Keeping them supporting each other and working as a team turns a potential negative experience into a positive one.