Competition among schools and educational quality: tension between various objectives of educational policy

Abstract

Using Chilean data for fourth grade students, this research studies the effect of competition among schools on the results of standardized tests, academic self-esteem and motivation, the climate within the school, civic participation and training, and healthy lifestyle habits. In order to address the potential bias due to the endogeneity of the competition among schools, an instrumental variable approach is implemented, using instruments associated with the size of each “educational market.” The results show that an increase of one standard deviation in competition among schools generates a moderate increase in standardized test results (0.06 standard deviations) and a more significant decrease in the other indicators of quality (between 0.02 and 0.16 standard deviations). Therefore, the results suggest a tension in the school between various objectives of educational policy, in which pressure to improve standardized test scores resulting from competition among schools could produce an undesired effect of deterioration in other dimensions of quality