The Role and Impact of Public-Private Partnerships in Education

40 THE ROLE AND IMPACT OF PUBLIC-PRIVATE PARTNERSHIPS IN EDUCATION
Table 3.5
Studies of subsidies
Empirical
strategy
Randomization
Country
and study
Balochistan,
Pakistan (Kim,
Alderman and
Orazem 1999)
Data: type
and year
Outcome
variables
Results
Panel: baseline
and follow-up
data, 1994 and
1995, student
level
Enrollment rate
Positive impact on girls’ enrollment:
22 percentage points (baseline: 56
percent enrollment).
Difference
in difference
Bogota,
Colombia (Uribe
et al. 2006)
School-level
panel data,
1999 and
2000, student,
teacher, and
school level
Standardized
test, math, 5th
grade
Private and public schools yield
the same achievements, after
controlling for individual and school
characteristics. Private schools
have wider dispersion; public
schools have teachers with higher
level of education. Strong evidence
of presence of peer effects.
Public schools have larger classes.
Sources: Authors’ compilation.
they found that students from private and
public schools had similar test scores. Their
second finding was that peer effects were
one important explanation of higher test
scores. Indeed, students with classmates
whose mothers had more education had
higher test scores. Third, class size was
an important determinant of test scores.
Fourth, private schools were more flexible
in contracting teachers, and teachers in
public schools have more education than
those in private schools. Fifth, the authors
found that the dispersion in test scores in
the private sector is wider and that the combination
of inputs is more diverse than in
public schools.
Private finance initiatives
As discussed earlier, it is not yet clear how
upgrading infrastructure affects education
outcomes (see table 3.1). Moreover, an
important line of research casts doubts on
whether increasing inputs such as infrastructure
influences education outcomes
(Hanushek 2003). The few studies that have
assessed the impact of private finance initiatives
on education outcomes are case studies;
for example, Audit Office of New South
Wales (2006) in Australia and Gibson and
Davies (2008) in the United Kingdom.
In terms Delivered of academic by The World achievement,
Bank e-library to:
KPMG (2008) found a significant unknowncorrelation
IP : 192.86.100.35
between private finance Mon, 30 Mar initiative 2009 12:16:23 schools
and improvements in test scores. Essentially,
between two rebuilt schools—one
funded by a private finance initiative and
the other by the public budget—there is a
90 percent chance that the school whose
reconstruction was funded by a private
finance initiative will have a faster rate
of academic improvement. Moreover, an
analysis of the first private finance initiative
school in the United Kingdom concluded
that the overall impact of the partnership
is positive as measured by improvements in
the quality of infrastructure, academic performance,
students’ attitudes and behavior,
and attendance indicators (Gibson and
Davies 2008). Nonetheless, whether these
results will be applicable elsewhere remains
to be seen because schools funded by private
finance initiatives tend to be characterized
by exceptional circumstances such as positive
attitudes toward the partnership on the
part of both the school and the private
contractor that influence the behavior of
students and teachers (Gibson and Davies
2008).
The main rationale for private finance
initiatives is cost savings. The private sector,
with a clear interest in the financial
outcomes of its own investments, is more
efficient than the public sector in using
resources and in maintaining the infrastructure
that it builds (Latham 2005).
Nevertheless, there is little actual evidence
that private finance initiatives lead
to cost savings, and, because the model is
relatively new, it is difficult to reach firm
conclusions.
(c) The International Bank for Reconstruction and Development / The World Bank