Effects of Education Policies and Institutions on Student Performance

Using panel estimates from the Program for International Student Assessment dataset, this study examines how education policies work as the quality of institutions improves. The findings suggest that autonomy over budget-related decisions positively affects the overall performance of students as the quality of institutions improves, whereas autonomy over academic decisions has an ambiguous effect. Considering that country-level institutions interact with school auto- nomy, the performance of low-ranking students is improved by pro- viding schools with enough power to decide on academic course con- tent and textbooks. Meanwhile, providing schools with great autonomy over budget-related decisions benefits high-ranking students.