Public Gains, Private Strains: Public Investment and Private Schooling in Peru

Sonja Fagernäs (), Diego de la Fuente Stevens (), Panu Pelkonen and Juan Manuel del Pozo Segura ()
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Sonja Fagernäs: University of Sussex
Diego de la Fuente Stevens: University of Sussex
Juan Manuel del Pozo Segura: Pontificia Universidad Católica del Perú

No 18189, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: In the 2010s, Peru experienced an increase in public educational investment, a substantial improvement in public school learning outcomes, and an erosion in the private sector learning premium. We use longitudinal, geo-coded register data on primary schools and pupils in urban areas to study how the improvement in public schooling affected private schools. With a difference in differences (DiD) framework, we demonstrate that the increase in public school quality reduced enrolment and test scores in private schools, primarily in areas with lower education levels. A staggered DiD analysis shows that new public school openings also reduced enrolment in nearby private schools.

Keywords: education policy; school quality; school competition; Latin America (search for similar items in EconPapers)
JEL-codes: H52 I20 L33 N36 (search for similar items in EconPapers)
Date: 2025-10
New Economics Papers: this item is included in nep-dev, nep-edu, nep-lam and nep-ure
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