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

  • Karthik Muralidharan
  • Venkatesh Sundararaman

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.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19441.

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Date of creation: Sep 2013
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Handle: RePEc:nbr:nberwo:19441
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  1. S. Narayan, 2009. "India," Chapters, in: The Political Economy of Trade Reform in Emerging Markets, chapter 7 Edward Elgar.
  2. Jishnu Das & Stefan Dercon & James Habyarimana & Pramila Krishnan & Karthik Muralidharan & Venkatesh Sundararaman, 2011. "School Inputs, Household Substitution, and Test Scores," NBER Working Papers 16830, National Bureau of Economic Research, Inc.
  3. 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 203-24, Winter.
  4. Atila Abdulkadiro─člu & Joshua Angrist & Parag Pathak, 2014. "The Elite Illusion: Achievement Effects at Boston and New York Exam Schools," Econometrica, Econometric Society, vol. 82(1), pages 137-196, 01.
  5. 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.
  6. 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, 09.
  7. Azam, Mehtabul & Chin, Aimee & Prakash, Nishith, 2010. "The Returns to English-Language Skills in India," IZA Discussion Papers 4802, Institute for the Study of Labor (IZA).
  8. 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.
  9. 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 158-87, July.
  10. Elizabeth King & Eric Bettinger & Erik Bloom & Joshua Angrist & Michael Kremer, 2002. "Vouchers for private schooling in colombia: Evidence from a randomized natural experiment," Natural Field Experiments 00203, The Field Experiments Website.
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