The Private Schooling Phenomenon in India: A Review

Abstract

This paper examines the size, growth, salaries, fee levels and per-pupil-costs of private schools, and compares these with the government school sector. Official data show a steep growth of private schooling and a corresponding rapid shrinkage in the size of the government school sector in India, suggesting parental abandonment of government schools. Data show that a very large majority of private schools in most states are ‘low-fee’ when judged in relation to state per capita income, per-pupil expenditure in the government schools, and the officially stipulated rural minimum wage rate for daily-wage-labour. This suggests that affordability is an important factor behind the migration towards and growth of private schools. The main reason for the very low fee levels in private schools is their lower teacher salaries, which the data show to be a small fraction of the salaries paid in government schools; this is possible because private schools pay the market-clearing wage, which is depressed by a large supply of unemployed graduates in the country, whereas government schools pay bureaucratically determined minimum-wages. The paper shows how education policies can be harmful when formulated without seeking the evidence.

Acknowledgements

The author gratefully acknowledges the research assistance of Prashant Verma with the statistical analysis of NSS and DISE data. Any errors are the authors. To get the data used in the paper, please contact the author by email.

Disclosure statement

The author is President of the board of a K-12 Registered Society private non-profit school in India, and a member of the government of Uttar Pradesh’s secondary school exam board (Madhyamik Shiksha Parishad).

Notes

1. In the interests of space, we have not included in this paper any consideration of the achievement levels of their students, the ‘value for money’ they offer and the implications of the Right to Education (RTE) Act for the existence and spread of private schools. These are covered in Kingdon (2017).

2. ‘Recognition’ is a government stamp of approval for a private school, to certify that it is fit to run as a school.

3. The agency that collates the DISE data nationally from all the states is the National University of Educational Planning and Administration, NUEPA, in New Delhi. The inconsistencies in DISE data have often been highlighted (for one example, see NUEPA study by Ramachandran, 2015).

4. For differences between private and aided schools, see Section 2 of Kingdon (2017).

5. One caveat with NSS data is that when householders fill this survey, some may not know whether the school their child attends is private aided or unaided, since this distinction is often not clear to a parent.

6. Muralidharan and Kremer (2006) found that in their national survey of 20 states, 51 per cent of all private rural primary schools were unrecognised. Aggarwal (2000) found that in his four surveyed districts of Haryana in 1999, 41 per cent of the 2120 surveyed schools were unrecognised. The PROBE survey of 1996 in 5 north Indian states did a complete census of all schools in 188 sample villages and found that 63 per cent of the private schools were unrecognised. Mehta (2005) found that in 7 districts of Punjab, out of 3058 private elementary schools, 86 per cent were unrecognised. For more evidence based on various data sources, see Kingdon (2007).

7. Uttar Pradesh government is in 2019 trying to consolidate many primary and upper primary schools that run in the same one premises but which were historically bifurcated and designated as different schools in order to create new headmaster posts to benefit some politically connected teachers. But its order to consolidate this has been legally challenged in the courts by the teacher unions.

8. The literature uses either simple regression analysis (Tooley & Dixon, 2005; Wadhwa, 2014), or use a variety of elaborate econometric techniques to correct for the problems of ‘selectivity’ and ‘endogeneity’, namely the problem that more able or more motivated students may self-select into private schools, techniques such as household fixed effects, village fixed effects, propensity score matching methods, panel data approach, and randomised control trials. These studies are by Kingdon (1996), Desai, Dubey, Vanneman, and Banerji (2008), Goyal (2009), French and Kingdon (2010), Chudgar and Quin (2012), Muralidharan and Sundararaman (2013), Singh (2015) and Azam, Kingdon, and Wu (2016).

9. The weighted average across the states for which the PPE data are available. The estimate of government PPE on education includes government expenditure on books and uniforms, but our private school’s PPE (proxied by the school’s fee) does not include expenditure on books and uniforms. However, the PPE estimates for public schools presented here are likely to be under-estimates of the true PPE of public schools (see next note).

10. Government of Tamil Nadu’s own estimate notified in GOTN (2017) shows the government’s PPE to be just over Rs. 28,000 in 2016–17, i.e. about double of Rs. 14,229 in Dongre and Kapur (2016) for Tamil Nadu. Similarly, Table 4 in Kingdon and Muzammil (2018) estimate Uttar Pradesh government schools’ PPE to be Rs. 18,180 in 2014–15, and Bose, Ghosh, and Sardana (2017) estimates it as Rs. 18,348 for UP in 2015–16, both higher than the Rs. 13,102 in Dongre and Kapur (2016). For a more detailed analysis, see Annexe 1 of Kingdon (2017).