Decomposing Learning Inequalities in East Africa: How Much Does Sorting Matter?

Abstract

Economic inequalities reflect inequalities in educational opportunities which in turn
are due to both household and school-related factors. Although these factors plausibly
co-vary, few studies have considered the extent to which sorting between schools and
households might aggravate educational inequalities. To fill this gap we develop a novel
variance decomposition and apply it to data on educational outcomes for over 1 million
children from East Africa. Our results indicate that sorting accounts for as much as 8
percent of the test-score variance, a figure similar in magnitude to the contribution of
differences in school quality alone. Empirical simulations of steady-state educational
inequalities show that policies to mitigate sorting between households and schools
could further reduce educational inequalities over the long-run substantially, equal to
cutting the inter-generational persistence of educational attainment by more than half.

Keywords: inequality of opportunity, education achievement, decomposition, household, school, sorting, Africa

JEL Classification: D6, H0, I2, O1