School Characteristics and Academic Achievement in Peru: Is the Geographical Distribution of Resources Reinforcing Social Exclusion?

This paper goes further in the discussion on the determinants of school attainment in developing countries arguing for the need to take into account the large inequalities in the distribution of traditional school resources and the supply constraints faced by students living in poorer areas. Using a data set containing detailed demographic and socioeconomic characteristics of students, as well as test scores for mathematics and integral communication in Peru, and implementing a twostep correction which accounts for the constraints in school choice, we show that failing to account for these constraints leads to an underestimation of the effect of school resources by about 100%. Not only are the coefficients twice as large but also the contribution of the differences in school resources to the explanation of the differences in math test scores among rich and poor children is doubled. An immediate policy implication is that those hoping to reduce the inequalities in the academic performance of Peruvian children need to consider easing the inequalities in the geographical distribution of traditional school resources. An exclusive focus on school and teacher incentives may help the less poor to improve but at the risk of leaving the poorest behind. JEL Classification: O10, I21, O54, D13