s. But if academic performance is correlated with economic circumstance,
then those outcomes would come at the cost of reaching the poor. Povertytargeted
incentives, on the other hand, do reach the poor and do induce greater
schooling—but if there is little learning to show for it, one might question the usefulness
of that approach. The potential tradeoff between equity and efficiency has been at the
center of discussions in many contexts: discussions on college scholarships in the
United States (Orfield 2002), social programs in developing countries (Coady, Grosch,
and Hoddinott 2003), and more generally on poverty reduction strategies in the presence
of tight budget constraints (Bardhan 1996).