NBER Working Paper No. 27377
National Bureau of Economic Research
India took a decisive step towards universal basic education by proclaiming a constitutionally-guaranteed Right to Education (RTE) Act in 2009 that called for full access of children aged 6-14 to free schooling. This paper considers the offsetting effects to RTE from induced expansion of private tutoring in the educationally competitive districts of India. We develop a unique database of registrations of new private educational institutions offering tutorial services by local district between 2001-2015. We estimate the causal impact of RTE on private supplemental education by comparing the growth of these private tutorial institutions in districts identified a priori as having very competitive educational markets to those that had less competitive educational markets. We find a strong impact of RTE on the private tutoring market and show that this holds across alternative definitions of highly competitive districts and a variety of robustness checks, sensitivity analyses, and controls. Finally, we provide descriptive evidence that these private tutoring schools do increase the achievement (and competitiveness) of students able to afford them.