THE EFFECT OF CLASS SIZE ON STUDENT ACHIEVEMENT IN DEVELOPING COUNTRIES:EVIDENCE FROM BANGLADESH

Mohammad Niaz ASADULLAH (Oxford University)

This paper examines the effect of class size on student achievement in Bangladesh using cross sectional data from a very recent survey of secondary schools. We exploit a Ministry of Education (MoE) rule regarding allocation of teachers to secondary grades to construct an instrument for class size and report a variety of OLS and IV estimates of the class size effect. This rule causes a discontinuity between grade enrolment and class size thereby generating exogenous variation in the latter. In such a quasi-experimental set up, researchers can effectively purge the effect of class size from the effects of other unobserved variables that are correlated with achievement.

We find that all the OLS and IV estimates of class size effect have perverse signs: both the naïve and IV estimates yield a positive coefficient on the class size variable. Our results suggest that reduction in class size in secondary grades is not efficient in a developing country like Bangladesh. Class size policy does not matter even in the poorer rural schools - schools with lower per student expenditure or lower average teacher salary - which tend to serve students from relatively poor socio-economic status.