Heterogeneity in School Value-Added and the Private Premium

62 Pages Posted: 8 Nov 2022

See all articles by Tahir Andrabi

Tahir Andrabi

Pomona College - Department of Economics

Natalie Bau

University of California, Los Angeles (UCLA)

Jishnu Das

Georgetown University; Georgetown University

Asim Ijaz Khwaja

Harvard University

Multiple version iconThere are 2 versions of this paper

Date Written: November 2022

Abstract

Using rich panel data from Pakistan, we compute test score based measures of quality (School Value-Addeds or SVAs) for more than 800 schools across 112 villages and verify that they are valid and unbiased. With the SVA measures, we then document three striking features of the schooling environment. First, there is substantial within-village variation in quality. The annualized difference in learning between the best and worst performing school in the same village is 0.4 sd; compounded over 5 years of primary schooling, this difference is similar in size to the test score gap between low- and high-income countries. Second, students learn more in private schools (0.15 sd per year on average), but substantial within-sector variation in quality means that the effects of reallocating students from public to private schools can range from -0.35sd to +0.65sd. Thus, there is a range of possible causal estimates of the private premium, a feature of the environment we illustrate using three different identification approaches. Finally, parents appear to recognize and reward SVA in the private sector, but the link between parental demand and SVA is weaker in the public sector. These results have implications for both the measurement of the private premium and how we design and evaluate policies that reallocate children across schools, such as school closures and vouchers.

JEL Classification: H44,I21,I25,I28,O12

Suggested Citation

Andrabi, Tahir and Bau, Natalie and Das, Jishnu and Khwaja, Asim Ijaz, Heterogeneity in School Value-Added and the Private Premium (November 2022). HKS Working Paper No. RWP22-020, Available at SSRN: https://ssrn.com/abstract=4270645 or http://dx.doi.org/10.2139/ssrn.4270645

Tahir Andrabi

Pomona College - Department of Economics ( email )

Claremont, CA 91711
United States
909-607-2513 (Phone)
909-621-8576 (Fax)

Natalie Bau

University of California, Los Angeles (UCLA) ( email )

405 Hilgard Avenue
Box 951361
Los Angeles, CA 90095
United States

Jishnu Das

Georgetown University ( email )

O Street
Washington, DC 20057
United States

Georgetown University ( email )

Old North, Suite 100
37th & O Streets NW
Washington, DC 20057
United States

Asim Ijaz Khwaja (Contact Author)

Harvard University ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States

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