Pricing of Private Education in Urban India: Demand, Use, and Impact

Abstract

This document summarizes preliminary analysis for a pricing experiment conducted in conjunction with the NGO Pratham’s after-school tutoring centers in New Delhi. Through a two-part pricing design, we are able to isolate whether willingness-to-pay is associated with higher utilization of these classes, and whether prices have causal impacts on attendance and dropout. By using our assigned prices as instruments for take-up of the classes, we can estimate the impacts of enrolment in the classes on student test scores. We find strong evidence that higher willingness to pay is associated with higher utilization, but that lower prices reduce dropout. The classes do not appear to impact test scores, an unexpected result for which we are currently exploring the mechanisms. This research was funded as part of the J-Pal Post-Primary Education Initiative The paper presents preliminary results which should not be cited