The Effect of Winning a First-Choice School Entry Lottery on Student Performance: Evidence from a Natural Experiment

In order to decide to what extent or in what manner school choice should be allowed, the same questions concerning various school choice and voucher programs in the U.S. and other parts of the world arise here: Is there any beneficial effect on student academic performance from entering the school of one’s choice? If there is any, what are the sources of this effect? Will school choice lead to social stratification due to differential parental school choice? Answers to these questions are important to assess the effect of school choice on educational quality and equity. This paper is the first attempt, as far as we know, to rigorously assess the consequence of school choice on student performance using the Chinese school choice lottery program; yet the results will not only be relevant to the on-going school choice reform in China, but also shed light on school choice programs worldwide. To answer the above questions, this paper exploits the preference-based random assignment of students to middle schools resulting from the educational reform in Beijing’s Eastern City District in 1998.