The effect of school grants on test scores: experimental evidence from Mexico

Abstract

We use a randomized experiment (across 200 public primary schools in Puebla, Mexico) to study the impact of providing schools with cash grants on student test scores. Treated schools received on average (Formula presented.) 16 USD per student each year for two years, an increase of (Formula presented.) 20% in public spending per child, after teacher salaries. Overall, the grants had no impact on student test scores. Lack of a treatment effect does not seem to be driven by poor implementation or a substitution away from other inputs (e.g. household expenditure).