TY - JOUR
T1 - Why Do Households Leave School Value Added on the Table? The Roles of Information and Preferences
AU - Ainsworth, Robert
AU - Dehejia, Rajeev
AU - Pop-Eleches, Cristian
AU - Urquiola, Miguel
N1 - Publisher Copyright:
© 2023 American Economic Association. All rights reserved.
PY - 2023/4
Y1 - 2023/4
N2 - Romanian households could choose schools with one standard deviation worth of additional value added. Why do households leave value added “on the table”? We study two possibilities: (i) information and (ii) preferences for other school traits. In an experiment, we inform randomly selected households about schools’ value added. These households choose schools with up to 0.2 standard deviations of additional value added. We then estimate a discrete choice model and show that households have preferences for a variety of school traits. As a result, fully correcting households’ beliefs would eliminate at most a quarter of the value added that households leave unexploited.
AB - Romanian households could choose schools with one standard deviation worth of additional value added. Why do households leave value added “on the table”? We study two possibilities: (i) information and (ii) preferences for other school traits. In an experiment, we inform randomly selected households about schools’ value added. These households choose schools with up to 0.2 standard deviations of additional value added. We then estimate a discrete choice model and show that households have preferences for a variety of school traits. As a result, fully correcting households’ beliefs would eliminate at most a quarter of the value added that households leave unexploited.
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U2 - 10.1257/aer.20210949
DO - 10.1257/aer.20210949
M3 - Article
AN - SCOPUS:85164699967
SN - 0002-8282
VL - 113
SP - 1049
EP - 1082
JO - American Economic Review
JF - American Economic Review
IS - 4
ER -