The Effect of Private Tutoring Expenditures on Academic Performance: Evidence from a Nonparametric Bounding Method

The causal relationship between educational investments and student outcomes continues to attract attention. The majority of studies have examined the effectiveness of public school expenditures or private school attendance on student outcomes. This paper contributes to the literature by examining the effectiveness of an unexplored dimension of educational inputs—private tutoring expenditures of South Korean parents. In the face of difficulties in causal estimation, the paper employs a nonparametric bounding method that is recently gaining popularity. With the method we show that the true effect of private tutoring remains at most modest. The tightest bounds suggest that a 10 percent increase in expenditure raises a student’s test score by 0.764 percent at the largest. Such a modest effect remains similar across male and female students, and across students of different ability levels. JEL Classification : I20, C30