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School Choice, Incentives, and Academic Outcomes: Evidence from Chile

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  • Francisco A. Gallego

Abstract

This paper examines the effects of inter-school competition on student outcomes by using exogenous variation in the availability of private schools in Chile. Given that naïve estimates of the effects of competition on student outcomes are biased by endogenous entry of schools, this paper uses variation in the number of Catholic priests per capita in different school markets, as an exogenous determinant of the supply of private schools. Results suggest that greater competition significantly raises both test scores and the productivity of schools. There is also evidence that the effects of school choice are significantly larger for students attending subsidized private schools, and insignificant or even negative for students attending public schools facing softer budget constraints

Suggested Citation

  • Francisco A. Gallego, 2004. "School Choice, Incentives, and Academic Outcomes: Evidence from Chile," Econometric Society 2004 Latin American Meetings 39, Econometric Society.
  • Handle: RePEc:ecm:latm04:39
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    File URL: http://repec.org/esLATM04/up.17368.1080314323.pdf
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    References listed on IDEAS

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    1. Claudio Sapelli & Bernardita Vial, 2003. "Peer Effects and Relative Performance of Voucher Schools in Chile," Documentos de Trabajo 256, Instituto de Economia. Pontificia Universidad Católica de Chile..
    2. Hoxby, Caroline M., 1999. "The productivity of schools and other local public goods producers," Journal of Public Economics, Elsevier, vol. 74(1), pages 1-30, October.
    3. Francisco Gallego, 2002. "Competencia y Resultados Educativos: Teoría y Evidencia para Chile," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 39(118), pages 309-352.
    4. Caroline M. Hoxby, 2000. "Does Competition among Public Schools Benefit Students and Taxpayers?," American Economic Review, American Economic Association, vol. 90(5), pages 1209-1238, December.
    5. Caroline M. Hoxby, 2003. "The Economics of School Choice," NBER Books, National Bureau of Economic Research, Inc, number hox03-1.
    6. Joshua Angrist & Eric Bettinger & Erik Bloom & Elizabeth King & Michael Kremer, 2002. "Vouchers for Private Schooling in Colombia: Evidence from a Randomized Natural Experiment," American Economic Review, American Economic Association, vol. 92(5), pages 1535-1558, December.
    7. Carnoy, Martin, 1997. "Is Privatization through Education Vouchers Really the Answer? A Comment," World Bank Research Observer, World Bank Group, vol. 12(1), pages 105-116, February.
    8. Dante Contreras, 2002. "Vouchers, School Choice and the Access to Higher Education," Working Papers 845, Economic Growth Center, Yale University.
    9. Glaeser, Edward L & Mare, David C, 2001. "Cities and Skills," Journal of Labor Economics, University of Chicago Press, vol. 19(2), pages 316-342, April.
    10. Derek Neal, 2002. "How Vouchers Could Change the Market for Education," Journal of Economic Perspectives, American Economic Association, vol. 16(4), pages 25-44, Fall.
    11. Claudio Sapelli, 2003. "The Chilean Voucher System: Some New Results and Research Challenges," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 40(121), pages 530-538.
    12. Helen F. Ladd, 2002. "School Vouchers: A Critical View," Journal of Economic Perspectives, American Economic Association, vol. 16(4), pages 3-24, Fall.
    13. Claudio Sapelli & Bernardita Vial, 2002. "The Performance of Private and Public Schools in the Chilean Voucher System," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 39(118), pages 423-454.
    14. Caroline Minter Hoxby, 1994. "Do Private Schools Provide Competition for Public Schools?," NBER Working Papers 4978, National Bureau of Economic Research, Inc.
    15. Chang-Tai Hsieh & Miguel Urquiola, 2003. "When Schools Compete, How Do They Compete? An Assessment of Chile's Nationwide School Voucher Program," NBER Working Papers 10008, National Bureau of Economic Research, Inc.
    16. Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, vol. 32(3), pages 385-397, August.
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    Citations

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    Cited by:

    1. Martin R. West & Ludger Woessmann, 2010. "'Every Catholic Child in a Catholic School': Historical Resistance to State Schooling, Contemporary Private Competition and Student Achievement across Countries," Economic Journal, Royal Economic Society, vol. 120(546), pages 229-255, August.
    2. Francisco Gallego & Andrés Hernando, 2009. "School Choice in Chile: Looking at the Demand Side," Documentos de Trabajo 356, Instituto de Economia. Pontificia Universidad Católica de Chile..
    3. Marcela Rom‡n & Marcela Perticar‡, 2012. "Student mobility in low quality schools: Segmentation among the most vulnerable students," Estudios de Economia, University of Chile, Department of Economics, vol. 39(2 Year 20), pages 159-177, December.
    4. Ricardo Paredes & Rómulo Chumacero & Juan Gallegos, 2012. "Competition Pressures and Academic Performance in a Generalized Vouchers Context," EcoMod2012 4184, EcoMod.
    5. Eisenkopf, Gerald & Wohlschlegel, Ansgar, 2012. "Regulation in the market for education and optimal choice of curriculum," Journal of Urban Economics, Elsevier, vol. 71(1), pages 53-65.
    6. W. Bentley MacLeod & Miguel Urquiola, 2009. "Anti-Lemons: School Reputation and Educational Quality," NBER Working Papers 15112, National Bureau of Economic Research, Inc.
    7. Filer, Randall K. & Münich, Daniel, 2013. "Responses of private and public schools to voucher funding," Economics of Education Review, Elsevier, vol. 34(C), pages 269-285.
    8. Gallego Francisco, 2013. "When Does Inter-School Competition Matter? Evidence from the Chilean “Voucher” System," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 13(2), pages 525-562, August.
    9. Francisco Henríquez & Alejandra Mizala & Andrea Repetto, 2009. "Effective Schools for Low Income Children: a Study of Chile’s Sociedad de Instrucción Primaria," Documentos de Trabajo 258, Centro de Economía Aplicada, Universidad de Chile.
    10. MacLeod, W. Bentley & Urquiola, Miguel, 2012. "Competition and Educational Productivity: Incentives Writ Large," IZA Discussion Papers 7063, Institute for the Study of Labor (IZA).
    11. Patrinos, Harry A. & Sakellariou, Chris, 2011. "Quality of Schooling, Returns to Schooling and the 1981 Vouchers Reform in Chile," World Development, Elsevier, vol. 39(12), pages 2245-2256.
    12. Bernardo Lara & Alejandra Mizala & Andrea Repetto, 2009. "The Effectiveness of Private Voucher Education: Evidence from Structural School Switches," Documentos de Trabajo 263, Centro de Economía Aplicada, Universidad de Chile.
    13. Pauline Dixon, 2013. "International Aid and Private Schools for the Poor," Books, Edward Elgar Publishing, number 15122.

    More about this item

    Keywords

    Vouchers; School choice; incentives; Chile;

    JEL classification:

    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education

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