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Private Education Market, Information on Test Scores and Tuition Practices

Sergio Firpo, Vladimir Ponczek and Vitor Possebom ()

No 8476, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: In this paper, we study the impact of disclosing information about school quality of private schools in Brazil on school choice. Particularly, we investigate whether test score disclosure affected private schools' tuition prices. In 2006, Brazil started to announce the schools' average test score of ENEM, a high school exit exam run by the federal government. Using longitudinal school data, we gauge the effect of test score disclosure on tuitions of private schools for three different schools levels (elementary, middle and high school). We find that the disclosure of schools' average test scores affects tuitions positively for all these three educational levels, but the effect is larger for high school tuitions. We also find that private education markets are local instead of national, since local ranks better predict tuition prices than national ranks. Finally, adjustments on prices did not follow immediately after the publication of scores but occurred gradually over time, revealing that the parents needed some time to trustfully associate results on the exam to new information on school quality.

Keywords: educational markets; information provision; private schools; tuition practices; school quality (search for similar items in EconPapers)
JEL-codes: O12 I21 L15 D82 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2014-09
New Economics Papers: this item is included in nep-cta, nep-edu, nep-lam and nep-ure
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