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Opting out from public services and the social contract in Latin America

  • The extent to which people are opting out from essential public services, such as education and health, poses a challenge to an already fragmented social contract in Latin America.


  • In the countries considered, close to 80% of wealthy households are out of the public education system, and a considerable proportion of them pay for a private health insurance, with Peru having the highest share (30%) and Colombia the lowest (less than 10%).


  • The proportion of middle-class households who opt for a private school varies more than previously thought, with the largest proportion in Peru (60%) and the smallest in Bolivia (20%). A small share of middle-class households opts for private health insurance.


  • Poor and vulnerable households are users of public services, but in cases like Peru and Colombia the proportion of vulnerable households sending their children to private schools is close to 20%.


  • The use of private education and health services is strongly associated with attitudes that matter for the social contract. On average, people who attended a private school in their formative years have worse evaluations of the public education system, are less supportive of the role of the state in providing this service, and, more generally, are less supportive of state-led redistribution. Results for the use of private health services point in the same direction, although the magnitude of the effect is smaller for the more general attitude towards the role of the state in promoting human welfare.

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