Within-school wealth inequality and learning achievement: Evidence from PISA

A large body of literature has documented a strong economic gradient of educational outcomes, with pupils from richer households obtaining, on average, better outcomes than pupils from poorer households. However, there is surprisingly very little evidence on the role of aggregate economic inequality on individual educational attainment, once the economic circumstances of the household have been controlled for. Using the 2012, 2015 and 2018 waves from the Programme for International Student Assessment (PISA), we find a robust negative relationship between test scores and within-school wealth inequality. Additionally, we observe that within-school wealth inequality interacts with school mean wealth. This suggests that the role of inequality may differ depending on the economic milieu, being stronger for schools attended by pupils from more affluent families. We go beyond the standard econometric interpretation of this interaction term and provide a reading of it in terms of within-school absolute inequality and aggregate relative deprivation.