Expanding School Enrollment by Subsidizing Private Schools

Many countries use tax revenues to subsidize private schools. Whether these policies meet social objectives depends, in part, on the relative quality of education provided by the two types of schools. We use data on elementary school students and their teachers in Bogot,̀ Colombia to examine difference in resource mixes and differences in the relative effectiveness of public and private schools. We find that, on average, the schools in the two sectors are equally effective. However, they produce education using very different resource combinations. Moreover, there are large differences in the effectiveness of schools in both sectors, especially in the private sector. The results of our analysis shed light on the quantity-quality tradeoff that governments in many developing countries face in deciding how to use scarce educational resources.