Effectiveness of Private and Public High Schools: Evidence from Finland

A number of papers have compared the effectiveness of private and public schools in different institutional settings. However, most of these studies are observational and do not utilize experimental or quasi-experimental design to evaluate the value-added or the effectiveness of private schools in comparison to public schools. This study focuses on private and public high schools in Helsinki, the capital city of Finland. We use two different methods to compare private and public schools, value-added estimation and regression discontinuity design (RDD). Although based on somewhat different assumptions, both methods allow us to evaluate the causal effect of private schools on the exit exam results in high school. We find that private schools perform marginally better than public schools, but the difference in performance is very small and statistically insignificant according to both methods. Various robustness and validity checks strengthen our RDD results and the validity of the discontinuity design.