Welcome to the Profit of Education website. Continuing the conversation begun in the book Profit of Education, we discuss the latest economic evidence on education reform.

Vouchers as competitive pressure

School vouchers generate much heat, albeit discussions with relatively little light. One argument offered in favor of vouchers is that vouchers increase competitive pressure on public schools, improving outcomes for all students–not just those who take up the vouchers.

David Figlio and Cassandra Hart offer us real evidence on the question. The authors looked at the introduction of a voucher program in Florida and compared outcomes in public schools that faced little competition from private schools to outcomes in public schools that faced more competition. In particular, they looked at public schools which risked losing substantial Title I funds if a significant number of low-income students were lured away. As is often the case when ideology faces careful empirical work, the answers are likely to please neither camp. Essentially, the answer is that public schools do respond to competition, but they don’t respond a whole lot.

In the words of Figlio and Hart:

We find that public schools subject to more competitive pressure from private schools raise their test scores more following the introduction of Florida’s voucher program. The effect sizes are precisely estimated but modest, with a one-standard deviation increase in competition raising test scores by less than one-twentieth of a standard deviation.

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