Is Private Education Better? Evidence from Chile

This paper uses Chile’s voucher system to provide new evidence on whether private schools are more efficient than publicly operated schools. It contributes to the world debate by analyzing a universal voucher system. It contributes to previous Chilean studies by reducing the selection bias and allowing heterogeneous treatment effects. The results suggest that public schools are neither uniformly worse nor better than private schools. Rather, public schools are relatively more effective for students from disadvantaged family backgrounds. Such a system of comparative advantage is consistent with the coexistence of public and private schools in most Chilean communes.