The Principled Agent

Thoughts on development economics and impact measurement

Archive for the ‘Education’ Category

School choice with impoverished information

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James Tooley’s book “The Beautiful Tree: A Personal Journey Into How the World’s Poorest People Are Educating Themselves” documents stories of effective, low-cost schools emerging independently to provide an education that the poor actually want and can financially support. While I share Tooley’s enthusiasm, there is one salient obstacle to a well-functioning educational market that I think needs addressing: the lack of adequate tools for parents to assess school quality.

While the quality of independent schools (some for-profit, others non-profit) is often much higher than government schools, there is considerable variance between schools. In theory, parents should be lining up for relatively cheap schools that prepare students to be accepted into top schools and eventually earn high wages (along with more general human development). Indeed best practice dictates that you best serve the poor with “no-frills” products, according to a Monitor Group report on innovative business models for emerging markets. Read the rest of this entry »

Written by Chris Prottas

October 28, 2010 at 12:35 pm

Posted in Education

When Does Schooling Pay?

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Robert Barro and Jong-Wha Lee report:

Results confirm that the rate of return to schooling varies across levels of education. The estimated rate of return is higher at the secondary (10.0%) and tertiary (17.9%) levels than at the primary level, which differs insignificantly from zero. The results imply that, on average, the wage differential between a secondary-school and a primary-school graduate is around 77% and that between a college and a primary-school graduate is around 240%.

The challenge of increasing educational attainment is evident in the numbers: education doesn’t pay at the beginning, and if you are uncertain about the future it might make sense just to work. PROGRESA provided conditional cash transfers to families based on school attendance, changing the economic incentives and positively affecting attendance; the question is whether this increased primary school attendance, in itself, is worth much. More often than we’d like to believe, the decision not to attend school is rational. Read the rest of this entry »

Written by Chris Prottas

June 19, 2010 at 4:50 pm

Posted in Development, Education