Do Public Colleges in Developing Countries Provide Better Education than Private ones? Evidence from General Education Sector in India

College educational outcomes of students graduating from public colleges in many developing countries are better than those graduating from private colleges. This is attributed to better quality of education provided. However, public colleges are subsidized suggesting that the observed gap might reflect pre-determined differences among students sorting into public colleges. We evaluate the impact of public colleges using a unique dataset that links admission records to college educational outcomes in India. We exploit the features of admission rules in a Regression-Discontinuity-Design, and find that the public colleges have no added value in the neighborhood of the admission cutoff scores. Controlling for entry scores, we find no differences between the exit exam outcomes of students graduating from public and private colleges..