Using School Scholarships to Estimate the Effect of Private Education on the Academic Achievement of Low Income Students in Chile

This paper estimates the impact of private education on the academic achievement of low-income students in Chile. To deal with selection bias, we use propensity score matching to compare the test scores of reduced-fee paying, low-income students in private voucher schools to those of similar students in public schools and free private voucher schools. Our results reveal that students in fee-charging private voucher schools score slightly higher than students in public schools. The difference in standardized test scores is approximately 10 points, a test score gain of 0.2 standard deviations. We find no difference in the academic achievement of students in the private voucher-fee charging treatment group relative to their counterparts in free private voucher schools. Variables used in the analysis are appended. (Contains 13 tables and 31 footnotes.) [Funding for this research was provided by Fondecyt, the Fulbright Commission, and PBCT-CONICYT Project CIE-05.]