Markets vs. State-Run School Systems: A Look at the Evidence
February 12, 2014
Andrew J. Coulson
When I began studying education policy back in the early 1990s, parent-driven education markets were generally thought of as a new, radical, and speculative adventure—uncharted waters where, heaven help us, “thar be monstars.”
That was a mistaken view then, and it’s positively absurd now.
As I wrote in Market Education: The Unknown History, the education market of classical Athens, in the 5th century BC, was the first time and place on earth in which education reached beyond a tiny ruling elite. There was no government participation in education. Teachers competed in the town square to attract paying customers, families called the shots, and the city ended up building a thriving economy and the highest literacy rate in the ancient world. During their heyday, the Athenians invented democracy, most forms of Western literature, and some pretty enduring art and philosophy.
Simultaneously, 100 miles away, Sparta established a highly organized system of public boarding schools. Its legacy? One decent action movie and a name for high school football teams.
Over the next 2,500 years, markets continued to outshine state-run school systems in their ability to serve the needs of families, and they also reduced the social tensions created by state schooling. Near-universal literacy and elementary enrollment among the free population were achieved in the United States by the mid-19th century—before the rise of state school systems—chiefly through private and home schools financed by a combination of parent fees and philanthropy. Even the semi-public “district” schools of the early 19th century charged most parents fees, reserving free and subsidized places for the poor.
Granted, historical evidence is subject to interpretation and charges of selectivity, and so it might not be universally persuasive. But, since 1990, scores of within-country scientific studies have compared education systems ranging from state-run monopolies such as our public schools, to state-funded and regulated private schools, to truly market-like systems in which regulation is minimal and parents choose their schools, as well as paying at least some of the cost directly themselves. I reviewed that body of research a few years ago for the Journal of School Choice and found that it shows private schools tend to outperform state-run schools. More specifically, it shows that the freest and most market-like education systems have the most consistent advantage over state schooling.
There is no credible case against this body of research. I could not find a single study that found a public school system to be more efficient than a market system in terms of student achievement per dollar spent. There weren’t even any insignificant findings for this comparison. Every single study that looked at the efficiency question found statistically significant results favoring education markets over state schooling. It’s rare to see such clear results in the social sciences, but perhaps that’s because there are few areas of life that are still under the thrall of state-run monopolies.
Education markets, when coupled with a mechanism to ensure universal access (such as education tax credits), are a better way to serve our individual needs and to advance our shared ideals. Compulsion and state provision are not only unnecessary, they are counterproductive to our most cherished educational ideals.
Andrew J. Coulson directs the Cato Institute’s Center for Educational Freedom and is author of Market Education: The Unknown History (Transaction Publishers, 1999).