LEARNING MORE WITH EVERY YEAR: SCHOOL YEAR PRODUCTIVITY AND INTERNATIONAL LEARNING DIVERGENCE

I use unique child-level panel data from Ethiopia, India, Peru, and Vietnam, four developing countries with widely differing levels of student achievement, to study the extent to which differences in the productivity of primary schooling can explain international differences in human capital. I document, using identical tests of quantitative skills across countries, that although some cross-sectional gaps in test scores between these countries are evident at preschool ages, these grow substantially in the first 2-3 years of schooling. By the age of 8 years, differences are particularly stark between Vietnam and the other three countries. Using value-added models, and a regression-discontinuity design based on enrolment guidelines, I show that the causal effect of an extra grade of schooling on test scores is substantially higher in Vietnam by 0.25-0.4 standard deviations compared to the other countries. This differential productivity of a school year accounts for most of the cross-country achievement gap at 8 years of age. Equalizing the exposure to and the productivity of schooling closes the gap with Vietnam almost entirely for Peru and India and by similar to 60% for Ethiopian students enrolled.