The high returns to low-cost private schooling in a poor country

While research from the U.S., Latin America and Asia provides little evidence that private schooling leads to greater educational attainment relative to public schooling, new research from the developing world suggests the opposite.

New research examining the case of private schooling in Kenya from Tessa Bold (University of Frankfurt), Mwangi Kimenyi (Brookings Institute), Germano Mwabu (University of Nairobi) and Justin Sandefur (Centre for Global Development), finds a large performance difference between private and public school students, equivalent to a full standard deviation of pupil-level test scores.

Moreover, the research suggests that private schools achieve these better results at far less cost, with median expenditure per privately-schooled pupil estimated at only US$41 per annum as compared to US$84 at government schools.

The authors argue that unlike in developed states, the effect of private schooling in a low-income African country with weak public sector institutions may be dramatically higher and worthy of greater policy attention.

While higher test scores may be the result of funding advantages or greater student ability, Bold and co-authors are able to control for these factors and measure the impact of private schooling on test scores by using an aggregation method which averages test scores in a district from both public and private schools over time.

Using scores from the Kenya Certificate of Primary Education (KCPE) examination, the authors take as the dependent variable the average score across both public and private schools for all students of a given gender, in a given district, and a given year. These average scores are then regressed on the proportion of students in private schools and controlled for fixed effects.