Preschool Education in Brazil: Does Public Supply Crowd Out Private Enrollment?

This paper examines whether an expansion in the supply of public preschool crowds out private enrollment, using rich data for municipalities in Brazil from 2000-2006, where federal transfers to local governments change discontinuously with given population thresholds. Results from a regression-discontinuity design reveal that larger federal transfers lead to a significant expansion of local public preschool services, but show no effects on the quantity or quality of private provision. These findings are consistent with a theory in which households differ in willingness to pay for preschool services, and private suppliers optimally adjust prices in response to an expansion of lower-quality, free-of-charge public supply.

Bibliographic Details

Main Author:	Inter-American Development Bank
Other Authors:	Paulo Bastos
Format:	Working Papers biblioteca
Language:	English
Published:	Inter-American Development Bank
Subjects:	Early Childhood Education, Preschool Education, Child Development, D12 - Consumer Economics: Empirical Analysis, I21 - Analysis of Education, I28 - Government Policy, L21 - Business Objectives of the Firm, O15 - Human Resources • Human Development • Income Distribution • Migration,
Online Access:	http://dx.doi.org/10.18235/0011518 https://publications.iadb.org/en/preschool-education-brazil-does-public-supply-crowd-out-private-enrollment
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