This paper uses survey data from representative samples of government and private schools in two states of India, Uttar Pradesh and Madhya Pradesh, to explore systematic differences between the two school types. The authors find that private school students have higher test scores than government school students. However, in both private and government schools the overall quality is low and learning gains from one grade to the next are small. There is large variation in the quality of both school types
and observed school and teacher characteristics are weakly correlated with learning outcomes. There is considerable sorting among students, and those from higher socio-economic strata select into private schools. Private schools have lower pupil-teacher ratios and seven to eight times' lower teacher salaries but do not differ systematically in infrastructure and teacher effort from government schools. Most of the variation in teacher effort is within schools and is weakly correlated with observed teacher characteristics such as education, training, and experience. After controlling for observed student and school characteristics, the private school advantage over government schools in test scores varies by state, school type and grade. Private unrecognized schools do better than private recognized schools. Given the large salary differential, private schools would clearly be more cost effective even in the case of no absolute difference in test scores.