The Effect of Subsidizing Digital Educational Content : Evidence from a Field Experiment

The unequal distribution of educational resources has been a major concern of both educators and policymakers around the world. The rise of the digital education industry brings new hope to the problem, but how exactly it affects existing education inequality remains largely unknown. Using data from a unique field experiment by an eBook app, we investigate the effects on K-12 children of improving access to digital educational resources. In particular, our analysis traces out both the short-run and long-run treatment effects of providing children with free access to digital reading resources, and how these effects vary across children with different socioeconomic backgrounds. We find that providing children with free access to digital reading materials leads to a dramatic and immediate increase in reading time (491%) for treated children, and that this immediate effect is much larger for children from less developed regions with fewer educational resources. However, children's reading activities decline quickly after the start of their free access. Surprisingly, this decline is much faster for children from less developed regions, despite their strong initial reaction to the treatment. Further evidence suggests that children from more developed regions benefit more from the free access in the long run. Our mechanism analysis further reveals a nuanced complementarity between digital and non-digital education and suggests that the long-run difference in reading patterns likely reflects differing levels of parental involvement in the education of children with different socioeconomic status. We discuss the managerial and policy implications of our study