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Competition Pressures and Academic Performance in Chile

Author

Listed:
  • Rómulo A. Chumacero
  • Juan Gallegos Mardones
  • Ricardo D. Paredes

    ()

Abstract

The positive impact that competition has on performance in most industries has been questioned in the education sector. The difficulty to measure competition, the idea that parents don’t rationally choose schools for their children, and that schools do not react to that choice is in the center of the debate. We critically analyze the prevailing methodology in the literature that relates competition and educational performance, and the data used to estimate that impact. We propose a methodology that considers relevant substitutes for each school using various attributes which parents consider when choosing schools, and we apply it to estimate the effect of competition on educational performance in Chile, were more than 90% of the students are covered by a voucher. The evidence supports the hypothesis that competition has a positive, statistically significant, and economically relevant educational impact on private and public schools.

Suggested Citation

  • Rómulo A. Chumacero & Juan Gallegos Mardones & Ricardo D. Paredes, 2016. "Competition Pressures and Academic Performance in Chile," Estudios de Economia, University of Chile, Department of Economics, vol. 43(2 Year 20), pages 217-232, December.
  • Handle: RePEc:udc:esteco:v:43:y:2016:i:2:p:217-232
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    File URL: http://www.estudiosdeeconomia.uchile.cl/index.php/EDE/article/viewFile/44117/46129
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    References listed on IDEAS

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    More about this item

    Keywords

    Vouchers; competition; performance;

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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