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The Aggregate Effect of School Choice: Evidence from a Two-stage Experiment in India

Author

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  • Karthik Muralidharan
  • Venkatesh Sundararaman

Abstract

We present experimental evidence on the impact of a school choice program in the Indian state of Andhra Pradesh (AP) that provided students with a voucher to finance attending a private school of their choice. The study design featured a unique two-stage lottery-based allocation of vouchers that created both a student-level and a market-level experiment, which allows us to study both the individual and the aggregate effects of school choice (including spillovers). After two and four years of the program, we find no difference between test scores of lottery winners and losers on Telugu (native language) and math, suggesting that the large cross-sectional test-score differences between public and private school students on these subjects mostly reflect omitted variables. However, private schools spent significantly less instructional time on Telugu and math, and instead taught more English, science, social studies, and Hindi. Averaged across all subjects, lottery winners scored 0.13`sigma` higher, and the average causal impact on test scores of attending a private school was 0.23`sigma`. Further, the mean cost per student in the private schools in our sample was less than a third of the cost in public schools. Thus, private schools in this setting deliver (slightly) better test score gains than their public counterparts, and do so at substantially lower costs per student. Finally, we find no evidence of spillovers on public-school students who do not apply for the voucher, or on private school students, suggesting that the positive impacts on voucher winners did not come at the expense of other students.

Suggested Citation

  • Karthik Muralidharan & Venkatesh Sundararaman, 2013. "The Aggregate Effect of School Choice: Evidence from a Two-stage Experiment in India," NBER Working Papers 19441, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:19441
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    References listed on IDEAS

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    1. Julie Berry Cullen & Brian A Jacob & Steven Levitt, 2006. "The Effect of School Choice on Participants: Evidence from Randomized Lotteries," Econometrica, Econometric Society, vol. 74(5), pages 1191-1230, September.
    2. Mehtabul Azam & Aimee Chin & Nishith Prakash, 2013. "The Returns to English-Language Skills in India," Economic Development and Cultural Change, University of Chicago Press, vol. 61(2), pages 335-367.
    3. David Clingingsmith, 2014. "Industrialization and Bilingualism in India," Journal of Human Resources, University of Wisconsin Press, vol. 49(1), pages 73-109.
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    5. 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.
    6. Jishnu Das & Stefan Dercon & James Habyarimana & Pramila Krishnan & Karthik Muralidharan & Venkatesh Sundararaman, 2013. "School Inputs, Household Substitution, and Test Scores," American Economic Journal: Applied Economics, American Economic Association, vol. 5(2), pages 29-57, April.
    7. Nicholas Bloom & John Van Reenen, 2010. "Why Do Management Practices Differ across Firms and Countries?," Journal of Economic Perspectives, American Economic Association, vol. 24(1), pages 203-224, Winter.
    8. Will Dobbie & Roland G. Fryer, 2011. "Are High-Quality Schools Enough to Increase Achievement among the Poor? Evidence from the Harlem Children's Zone," American Economic Journal: Applied Economics, American Economic Association, vol. 3(3), pages 158-187, July.
    9. Atila Abdulkadiroğlu & Joshua D. Angrist & Susan M. Dynarski & Thomas J. Kane & Parag A. Pathak, 2011. "Accountability and Flexibility in Public Schools: Evidence from Boston's Charters And Pilots," The Quarterly Journal of Economics, Oxford University Press, vol. 126(2), pages 699-748.
    10. S. Narayan, 2009. "India," Chapters,in: The Political Economy of Trade Reform in Emerging Markets, chapter 7 Edward Elgar Publishing.
    11. Tessa Bold, Mwangi Kimenyi, Germano Mwabu, Justin Sandefur, 2011. " The High Return to Private Schooling in a Low-Income Country- Working Paper 279," Working Papers 279, Center for Global Development.
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    Citations

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    Cited by:

    1. Karthik Muralidharan & Venkatesh Sundararaman, 2013. "Contract Teachers: Experimental Evidence from India," NBER Working Papers 19440, National Bureau of Economic Research, Inc.
    2. Miguel Urquiola, 2015. "Progress and challenges in achieving an evidence-based education policy in Latin America and the Caribbean," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 24(1), pages 1-30, December.
    3. Mark Rosenzweig & Ahmed Musfiq Mobarak, 2013. "Risk, Insurance and Wages in General Equilibrium," Working Papers 1035, Economic Growth Center, Yale University.
    4. repec:bla:rdevec:v:21:y:2017:i:4:p:1191-1204 is not listed on IDEAS
    5. Asim,Salman & Chase,Robert S. & Dar,Amit & Schmillen,Achim Daniel, 2015. "Improving education outcomes in South Asia : findings from a decade of impact evaluations," Policy Research Working Paper Series 7362, The World Bank.
    6. Lant Pritchett & Martina Viarengo, 2015. "The State, Socialisation, and Private Schooling: When Will Governments Support Alternative Producers?," Journal of Development Studies, Taylor & Francis Journals, vol. 51(7), pages 784-807, July.
    7. Kingdon, Geeta G., 2017. "The Private Schooling Phenomenon in India: A Review," IZA Discussion Papers 10612, Institute for the Study of Labor (IZA).
    8. Servaas van der Berg & Chris van Wyk & Ronelle Burger & Janeli Kotzé & Marlies Piek & Kate Rich, 2017. "The performance of low fee independent schools in South Africa - What can available data tell?," Working Papers 01/2017, Stellenbosch University, Department of Economics.
    9. Pal, Sarmistha & Saha, Bibhas, 2014. "In 'Trusts' We Trust: Socially Motivated Private Schools in Nepal," IZA Discussion Papers 8270, Institute for the Study of Labor (IZA).
    10. repec:eee:injoed:v:56:y:2017:i:c:p:42-51 is not listed on IDEAS
    11. Singh, Abhijeet, 2015. "Private school effects in urban and rural India: Panel estimates at primary and secondary school ages," Journal of Development Economics, Elsevier, vol. 113(C), pages 16-32.
    12. Powell-Jackson, Timothy & Ansah, Evelyn K., 2015. "The indirect effects of subsidised healthcare in rural Ghana," Social Science & Medicine, Elsevier, vol. 144(C), pages 96-103.
    13. Centre for Civil Society CCS, 2015. "Meta-Study of Literature on Budget Private Schools in India," Working Papers id:7950, eSocialSciences.

    More about this item

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • H44 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Goods: Mixed Markets
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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