face social and/or commuting barriers in traveling to work outside of the local community.

27. It is important to continue developing better understanding of what works in unaided private schools, as well as what does not work, as performance in these schools is also alarmingly poor. Moreover, long-term improvements in learning may require changes that are different than the changes that bring short-term gains. For example, as children become more educated, they will need more supply of better qualified teachers to provide them with enhanced knowledge and skills. It should also be noted that many unaided private schools in the region are unregistered, and therefore not subject to government regulations (see, for example, Kingdon, 2007; Goyal and Pandey, 2011). Yet, their student achievement is no worse. Goyal and Pandey (2011) even find that in Uttar Pradesh, India, grade-4 and grade-5 students in unregistered private schools perform better than students in government and registered private schools. This casts doubt on the effectiveness of regulations, especially in the face of weak institutional capacity and corruption.

# **III.b. Traditionally aided private schools in India and Bangladesh (Type (2) in Table 1)**

28. The evidence shown in Figure 6 indicates that performance of aided schools in India is quite similar to, if slightly poorer than, performance of unaided schools. This pattern coincides with that reported by Goyal and Pandey (2011), controlling for student, household, and schoollevel characteristics. In Bangladesh, at the primary level, test scores from the 2011 National Student Assessment are reported to be even higher for government schools than for recognized non-government schools, most of which receive subsidies from the government (World Bank, 2013). It is important to note a key feature common among aided schools in the region, which is that teachers in these schools are actually hired through the government system, and subsidies are made based on enrollment. If enrollment is correctly reported, and households can effectively choose better schools, this mechanism would induce behavior on the part of teachers and headteachers in the same way as market mechanisms do to enforce accountability in unaided schools. However, enrollment reporting tends to be subject to large upward margin errors due to technical and administrative loopholes in the system (Kingdon, 2007). Moreover, the elimination of school tuition in aided schools may make parents more tolerant of school weaknesses.

# **III.c. Aided private schools with student achievement incentives in Pakistan (Type (2) in Table 1)**

29. Although government support to private schools in Pakistan is rare, recent public-private partnership initiatives have proven to cost-effectively generate gains in student participation and achievement. For example, the Foundation-Assisted School (FAS) program, introduced in 2005 and administered by the Punjab Education Foundation (PEF), provides monthly per-student subsidies to low-cost private schools conditional on free schooling for all students and a minimum student pass rate on a standardized academic test. There are also group-based teacher bonuses conditional on a minimum score on a composite measure of student test participation and mean test scores, and competitive bonuses for schools that rank highest in average student scores on the test. As of June 2010, at its sixth phase of expansion, the FAS program was supporting about 800,000 students in 1,800 schools in 29 of the 36 districts in the province.

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