The Equilibrium Impacts of Unconditional Grants to Private Schools

Last registered on May 31, 2018


Trial Information

General Information

The Equilibrium Impacts of Unconditional Grants to Private Schools
Initial registration date
May 26, 2018

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
May 30, 2018, 9:22 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Last updated
May 31, 2018, 9:33 AM EDT

Last updated is the most recent time when changes to the trial's registration were published.



Primary Investigator


Other Primary Investigator(s)

PI Affiliation
Sabanchi University
PI Affiliation
Pomona College
PI Affiliation
World Bank
PI Affiliation
Harvard University

Additional Trial Information

Start date
End date
Secondary IDs
As market-based provision gains importance in education, addressing market failures can have substantial impact. This paper alleviates one such failure - access to finance - by experimentally allocating capital to 855 private schools across 266 villages in rural Pakistan. We provide either a `Low saturation' (L) treatment where only one private school in the village was randomly chosen to receive an unconditional grant of $500, or a `High saturation' (H) treatment, where all private schools received $500 each. Treated schools in the L arm saw substantial increases in revenues due to higher enrollment and investments in physical infrastructure, but show no increase in test scores or fees. In contrast, in the H arm, revenues increased due to both greater enrollment and increased fees. The higher fees accompanied test score increases as schools invested in additional infrastructure and teachers. The differential impact naturally follows from an understanding of the underlying market structure in an oligopolistic setting with capacity constraints and vertical differentiation. In the H arm, capacity expansion is less attractive as competition over a limited student pool may trigger a price-war. Therefore schools are more likely instead to invest in quality. While financial returns exceeded market interest rates in both cases, private returns are higher in the L arm whereas social returns are arguably higher in the H arm. This underscores the importance and appropriate design of public subsidies to the educational sector.
External Link(s)

Registration Citation

Andrabi, Tahir et al. 2018. "The Equilibrium Impacts of Unconditional Grants to Private Schools." AEA RCT Registry. May 31.
Former Citation
Andrabi, Tahir et al. 2018. "The Equilibrium Impacts of Unconditional Grants to Private Schools." AEA RCT Registry. May 31.
Experimental Details


Our intervention sample comprises of private schools in 266 villages in Punjab, Pakistan. We offer unconditional cash grants of Rs 50,000 (approximately $500 in 2012) to every school randomly selected for treatment. We deliberately choose not to impose any conditions on the use of the grant apart from submission of a (non-binding) business plan. Schools are given two weeks to fill out the plan and must specify a disbursement schedule with a minimum of two installments. Funds are disbursed through the opening of a one-time use bank account for cash deposits.
Intervention Start Date
Intervention End Date

Primary Outcomes

Primary Outcomes (end points)
Enrollment, Fees, Test scores, Costs, School Inputs
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
We use a two-stage stratified randomization design where we first assign each village to one of three experimental groups and then schools within these villages to treatment. The three experimental groups are as follows: (1) Pure control - no school is offered a grant; (2) High-saturation: all schools are offered grants; and (3) Low-saturation: only 1 school in the village, regardless of the total number of private schools in the village, is offered a grant.
Experimental Design Details
Randomization Method
Computerized ballot conducted publicly
Randomization Unit
Two-stage randomization: (1) Villages; and (2) Schools
Was the treatment clustered?

Experiment Characteristics

Sample size: planned number of clusters
266 villages
Sample size: planned number of observations
880 schools
Sample size (or number of clusters) by treatment arms
77 control villages, 75 high-saturation villages, and 114 low-saturation villages
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number


Post Trial Information

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Is the intervention completed?
Data Collection Complete
Data Publication

Data Publication

Is public data available?

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials