Working Paper: NBER ID: w10008
Authors: Changtai Hsieh; Miguel Urquiola
Abstract: In 1981, Chile introduced nationwide school choice by providing vouchers to any student wishing to attend private school. As a result, more than 1,000 private schools entered the market, and the private enrollment rate increased by 20 percentage points, with greater impacts in larger, more urban, and wealthier communities. We use this differential impact to measure the effects of unrestricted choice on educational outcomes. Using panel data for about 150 municipalities, we find no evidence that choice improved average educational outcomes as measured by test scores, repetition rates, and years of schooling. However, we find evidence that the voucher program led to increased sorting, as the best' public school students left for the private sector.
Keywords: school choice; voucher program; Chile; educational outcomes; sorting
JEL Codes: I2; L3; O1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Voucher Program (I22) | Average Educational Outcomes (I21) |
| Increased Private Enrollment (I23) | Declining Public School Performance (I21) |
| Voucher Program (I22) | Increased Sorting (C69) |
| Increased Sorting (C69) | Exodus of Middle-Class Students from Public Schools (I21) |
| Exodus of Middle-Class Students from Public Schools (I21) | Negative Impact on Public School Performance (I21) |