Based on a budgetary assessment, SEF supported coeducational, private primary schools in 200 villages in the selected districts. The main benefits that program-school operators received included a per-student cash subsidy; free school leadership and teacher training; and free textbooks, other teaching and learning materials, stationery, and bookbags.<sup>5</sup> Two types of monthly per-student subsidies were provided: a gender-uniform subsidy, where the school received 350 rupees (approximately $5 in annualized 2008 US dollars) for each student; and a genderdifferentiated subsidy, where the school received 350 rupees for each male student and 450 rupees ($6.4) for each female student. A total of 100 schools received the gender-uniform subsidy, and another 100 schools, the gender-differentiated subsidy. All schools received the other benefits.

The subsidy amounts were set at less than one-half of the per-student cost in public primary and secondary government schools in the province, and were not adjusted for price inflation over the evaluation period.<sup>6</sup> Provided on a quarterly basis, a school’s total subsidy was linked to the number of children in attendance multiplied by 1.25 to reflect an expected 20-percent student-absence rate. SEF gathered attendance information through periodic, unannounced monitoring visits to program schools.

Local private entrepreneurs were invited to apply to the program through an open call in newspapers, and to propose educationally underserved villages in the selected districts to establish and operate schools. SEF vetted the applications (ultimately, through visits to shortlisted villages) based on several criteria, including written assent from the parents of at least 75 children of primary-school ages that they would enroll their children in the school, should it be established; a school site in the village that was located at least 1.5 kilometers from the nearest other school; a building of sufficient size; and the identification of teachers with a minimum of eight years of schooling (middle school completion), with at least two being female.<sup>7</sup> Once in the program, school operators would continue to receive the subsidy and other benefits, as long as they provided free schooling to children, and provided and maintained school infrastructure and the schooling environment consistent with SEF guidelines. SEF strictly enforced the free-schooling condition, but was more lenient in enforcing the school infrastructural features and environmental conditions.

# **3 Potential mechanisms**

In the basic human-capital acquisition model (Becker, 1962), households compare the present and future costs and benefits of educating their children. School fees and transportation costs, both in terms of direct

> 5The subsidies were transferred electronically to the bank accounts of the private entrepreneurs.

> 6Per-student costs in government schools were based on information from the provincial Education and Literacy Department’s annual census of government schools and the provincial Finance Department’s records on recurrent budgets and expenditures toward primary and secondary education.

> 7SEF viewed eight years of schooling as sufficiently high that teachers would have the competency to teach primary school content, but low enough that qualified individuals could be found locally.

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