Private schools in rural India provide similar education at much lower cost than govt schools

Karthik Muralidharan and others have an interesting research paper on the differences between private and public (i.e. government run) schools in rural India, where they discover, over the course of a large, 4-year, controlled study they discover that private schools comparable (actually, slightly better) education, but at costs much lower than the government schools.

This was the setup (in Andhra Pradesh):

The AP School Choice Project provided children who were enrolled in free public primary schools with a voucher that allowed them to attend a private school of their choice.

And here are the main finding:

We find that the main operating difference between private and public schools in India is that private schools pay substantially lower teacher salaries (less than a sixth of that paid to public school teachers), and hire teachers who are younger, less educated, and much less likely to have professional teaching credentials. However, they hire more teachers and have smaller class sizes and less multi-grade teaching than public schools. Using official data as well as data collected from direct observations conducted during unannounced visits to schools, we find that private schools have a longer school day, a longer school year, lower teacher absence, higher teaching activity, and better school hygiene. We find no significant change in household spending or in time spent doing homework among voucher-winning students, suggesting that the impact of the program (if any) is most likely to be due to changes in school as opposed to household factors

So, private schools have cheaper teachers, but spend more time teaching. What about the performance of the students?

However, in spite of the superior performance of the private schools on most measures of school processes, we find at the end of two and four years of the school choice program that lottery winners do no better than lottery losers on tests of Telugu (native language of AP) and Math. Our data from school time tables suggest that a likely explanation for these results is that private schools spend significantly less instructional time on Telugu and Math, and instead spend more time on English, Science, Social Studies, and Hindi. We conduct tests in these subjects at the end of four years of the program and find positive (but insignificant) effects of winning the voucher on test scores in English, Science, and Social Studies (of around 0.1ı each), and positive (and highly significant) effects on test scores in Hindi (of 0.5ı). Averaging across all subjects, we find that students who won a voucher scored 0.13ı higher, and students who attend private schools score 0.23ı higher.

What does all this mean? Here is the bottom line – private schools provide slightly better education at much lower prices:

the combination of test score results and school time table data already show that private schools are more productive than public schools because they are able to achieve similar Telugu and Math test scores for the lottery winners with substantially less instructional time, and use the additional time to improve outcomes on other subjects – especially Hindi. But the cost-effectiveness comparison is rendered stark by the fact that the annual cost per student in the government- school system is over three times the mean cost per student in the private schools in our sample. Thus, students who win a lottery to attend private schools do as well on some subjects and better on others even though the private schools spend substantially lower amounts per student

Check out this short article by the author where he asks this question:

Since private schools achieved equal or better outcomes at one-third the cost, the fundamental question that needs to be asked is “How much better could private management do if they had three times their current level of per-child spending?” Thus, in addition to focusing on improving the effectiveness of government schools at the current level of spending, the results suggest that policymakers should be open to experimenting with models of education provision with public funding (to ensure universal access) and private provision (for better school management).


Overall, policy discussions need to move away from debates of ‘public’ versus ‘private’ provision of education, which are (a) too simplistic because averages hide enormous variation within both public and private schools, and (b) not very useful because both systems are unlikely in their current form to deliver significant improvements in outcomes. Rather, the focus should be on the design of better education ‘systems’ that aim to deliver superior outcomes by leveraging the strengths of both the public and the private sector while mitigating the weaknesses of the other. Clause 12 of the RTE provides the ideal context in which to have this discussion of education systems.

Read the full paper, or this short article by the author where he asks this question:

Source: Marginal Revolution Blog