School Competition and Students' Entrepreneurial Intentions: International Evidence Using Historical Catholic Roots of Private Schooling. Working Papers Series. PEPG 10-01

School choice research mostly focuses on academic outcomes. Policymakers increasingly view entrepreneurial traits as a non-cognitive outcome important for economic growth. We use international PISA-2006 (Programme for International Student Assessment -2006) student-level data to estimate the effect of private-school competition on students' entrepreneurial intentions. We exploit Catholic-Church resistance to state schooling in 19th century as a natural experiment to obtain exogenous variation in current private-school shares. Our instrumental-variable results suggest that a 10 percentage-point higher private-school share raises students' entrepreneurial intentions by 0.3-0.5 percentage points (11-18 percent of the international mean) even after controlling for current Catholic shares, students' academic skills, and parents' entrepreneurial occupation. (Contains 6 tables and 8 footnotes.) [Partial funding for this research was provided by the Fritz Thyssen Foundation.]