Craig Hill
KC Hill
Paladin
Oracle of DelphiObjections to Market Based Reforms in Education
September 28th 2006 02:02
Preliminary remarks
Vouchers and for profit education
I have proposed a number of different alternatives to the current education system in Australia. I have discussed three different reforms: a voucher system, curriculum competition and for-profit education. These are all different. You could have a voucher system which does not allow for profit schools, you could have for profit school without a voucher system, you could have both or you could have neither as is the current set up (although the supply of some government funds to private school could be describes as a semi voucher scheme). It's important to keep in mind the difference between these three aspects otherwise the argument gets confused.
Voucher Varieties
There are many different types of voucher schemes. Vouchers can be means tested or not, they can be universal or not, they can be weighted according to the recipients SES or not and so on. It's not as simple as voucher or no voucher.
Government regulation of for profit schooling
I've never argued for complete deregulation of education. I've always argued that government would have a role in regulation a for profit education market, just as it regulates all commercial activity. The degree and nature of this regulation is open to debate and there are as many answers as there are economists. My main argument is against the complete government monopoly of school curriculum and the extent to which government involves itself in the provision of education.
Having said that I'll attempt to reply to your points as best I can
Objection 1. The market cannot provide a service where it is not profitable.
Reply
1) Just as government regulates telecommunications in the bush, so it could regulate the provision of education in remote areas.
2) Vouchers could be weighted in favour of remote areas to attract for profit schools.
3) The market may find innovative profitable ways to provide education to remote areas.
4) If for-profit, not-for profit and public schools all competed for business the schools which currently provide for remote areas would continue to operate.
Objection 2. The market is not completely efficient, and very often it is the image (brand) of a product that improves, not the product itself.
Reply
1) Yes, education is a complicated product. But parents if parents have a choice about the education they are buying and if they are spending their hard earned dollars on an education they will be very motivated to investigate the products on the market and source those which meet their needs and the needs of their children. This is more true then ever as people are having fewer children and having them later in life.
2) Yes, education is a complicated product, but we trust consumers to decide on things such as mortgages, insurance policies, health care plans and even governments. If they can get their heads around these things, they can also exercise choice in education.
3) The funds diverted to advertising education would be more than made up in the efficiency brought about from dismantling a government monopoly on education. Monopolies are universally acknowledged as being the lest efficient means to provide services.
Objection 3. The market focuses on providing chiefly those qualities that are measurable.
Reply
Since parents value the qualities you mention such as "care the teachers provide, the growing of friendships, a culture of sport, or intellect, or spirituality, or tolerance" the school's reputation will depend on their ability to provide these. Yes, they are not measurable but the word will soon get out if they are missing from a school and that school will find it hard to attract students.
The problem you highlight of a whole generation missing out on something before the mistake is recognised is the very reason a government monopoly should be done away with. With the stroke of a pen the curriculum for NSW can be changed and then every student in the state is subject to the new regime - no exceptions. Witness the wholesale abolition of tradition grammar, spelling drill and phonics in reading. They were done away with across the board, a whole generation missed out and only now are they coming back in. This could never happen in a diverse market based system. In a more flexible market based set up a new innovation can be trialled. If it works, it spreads, if not - it dies a quick and natural death.
Objection 4. The market creates greater inequality in the available choices and niche consumerism.
Reply
Inequalities can be smoothed out using means tested or income weighted vouchers. Niche consumerism encourages innovation. (see above). Studies in the US show that voucher schools are in fact more egalitarian than others. (See Schools, Vouchers, and the American Public by Terry M. Moe for more details). The fear of balkanisation under a voucher system has been shown to be unfounded. Many parents want their children to mix with others from a broad social, ethnic and religious mix and choose such schools.
Objection 5. The market can tend to a monopoly
Reply
See my introductory comments on the role of government regulation in education markets. The government could, for example, offer incentives which ease entry into and exit from the education market. This mitigates against a monopoly. The government legislates against monopolies in other markets such as the media, limiting the number of media outlets a single company can own in an given state. It may have a similar role in an education market.
*Image courtesy of www.morguefile.com
| 58 |
| Vote |
subscribe to this blog
Go to Craig Hill's home page by clicking here
Comment by nagster
Cenacle
Comment by David
1. Profit would not be the only reason for establishing new schools. The remarkable growth of the Catholic system between 1880 and 1960 without one penny of Government money is indicative of the wide range of motives that goes into establishing a school. If there was a problem with particular areas I would suggest that entry of schools into the market could be enhanced by interest free government loans to community groups to establish infrastructure and ease the early years until the school was firmly grounded.
2. The problem of state schools is not a matter of provision per se. It is the monopolistic regulation of the curriculum, school standards and teaching. These are all at the whim of the government of the day. As can be seen in the present situation where teachers are objecting to the Federal government using its fiscal power to impose its vision of education on schools. This is the inevitable consequence of the teachers unions and special interest groups using the centralised system to promote their own fads and have them enforced state-wide. This leaves no room for "school vision" to promote a wide variety of learning and teaching styles and reduces school staff to executors of the Departments will, the antitheis of the professionalism much trumpeted by teachers and politicians.
3. Governments in general have difficulties in dealing with individuals and diversity. The result is the provision of aggregated services that fit a statistical and therefore fictitious student. Those below this mean are unable to receive the individual teaching and curriculum help they require while those above are not given the enrichment they crave. A good example of this is seen in the GATS programs that have sprouted in state schools recently. Most GATS students are not polymaths. They often have very narrow areas of speciality. Yet they are generally dealt with in a catch-all program that assumes that all they need is extra work. They quickly learn to "play dumb" or turn off what doesn't interest them. The programs make no provision for the very individual learning styles and patterns of GATS students.
4. The state monopoly of education privileges those theories of education which catch the ministerial eye or the bureaucratic attention. Yet it has been shown that tehre are many different approaches to education. There is not one single educational system that can claim to resolve all educational needs. A state system inevitably requires a unified educational approach that is itself subject to critical analysis. The several fads which have swept through education in the last 30 years are indicative of the need for flexibility which no centralised state system can supply.
5. The state system is built on the idea that education is a public good yet beyond ensuring a minimum competence in literacy and numeracy, basic civics and adequate access to educational opportunity for all it is hard to see what the public gains from extended education. In reality education beyond these minimum requirements is a private good and as such is best handled by allowing a free choice among a range of educational alternatives to suit individual needs. To a large extent state education has survived due to the desire of the majority to have their private good paid for by the state. If the state considers this a valid policy option it would be better served by providing funding to the student to pursue his individual education. After all the state would not benefit if all graduates were doctors and none were engineers.