The Economics of School Choice
edited by Caroline M. Hoxby
University of Chicago Press, 2003
Cloth: 978-0-226-35533-7 | Electronic: 978-0-226-35534-4


Now that the U.S. Supreme Court has declared school voucher programs constitutional, the many unanswered questions concerning the potential effects of school choice will become especially pressing. Contributors to this volume draw on state-of-the-art economic methods to answer some of these questions, investigating the ways in which school choice affects a wide range of issues.

Combining the results of empirical research with analyses of the basic economic forces underlying local education markets, The Economics of School Choice presents evidence concerning the impact of school choice on student achievement, school productivity, teachers, and special education. It also tackles difficult questions such as whether school choice affects where people decide to live and how choice can be integrated into a system of school financing that gives children from different backgrounds equal access to resources. Contributors discuss the latest findings on Florida's school choice program as well as voucher programs and charter schools in several other states.

The resulting volume not only reveals the promise of school choice, but examines its pitfalls as well, showing how programs can be designed that exploit the idea's potential but avoid its worst effects. With school choice programs gradually becoming both more possible and more popular, this book stands out as an essential exploration of the effects such programs will have, and a necessary resource for anyone interested in the idea of school choice.


Caroline M. Hoxby is a professor of economics at Harvard University and director of the Economics of Education Program at the National Bureau of Economic Research.




- Caroline M. Hoxby
DOI: 10.7208/chicago/9780226355344.003.0001
[school choice, economic analysis, general equilibrium tools, student sorting, school finance, special education, school productivity, academic achievement]
This introductory chapter explains the rationale for conducting an economic analysis of school choice. Economists produce tools for evaluating various impacts of school choice. Without these tools, such as general equilibrium tools, is it not possible to predict the effects of school choice on student sorting. It is also argued that school choice and school finance are interdependent, and that school choice affects the labor market for educators. The chapter furthermore examines the impact of school choice on special education, school productivity, and academic achievement. (pages 1 - 22)
This chapter is available at:
    University Press Scholarship Online

- Eric A. Hanushek, Steven G. Rivkin
DOI: 10.7208/chicago/9780226355344.003.0002
[public schools, competition, Texas, school choice, teaching quality, quality of education, metropolitan students]
This chapter examines how public schools respond to competition from other schools, and how competition affects teaching quality, using data from the public school system in Texas. It evaluates the hypothesis that school choice will force schools to employ teachers of a more consistent, high quality. The analysis indicates that competition raises teacher quality and improves the overall quality of education, and that school choice is more meaningful for metropolitan students than for rural students. (pages 23 - 48)
This chapter is available at:
    University Press Scholarship Online

- David N. Figlio, Marianne E. Page
DOI: 10.7208/chicago/9780226355344.003.0003
[voucher system, Florida, achievement standards, school choice, performance criteria, economically disadvantaged children]
This chapter examines the voucher system in Florida, whereby students are offered vouchers if they attend school, which consistently fails to meet Florida's achievement standards. It investigates the fundamental difference between such school choice programs and more conventional programs, in which eligibility is based mainly on students' own characteristics. The findings suggest that the performance criteria that may seem most appropriate from an accountability perspective may not do the best job of targeting economically and socially disadvantaged children. (pages 49 - 66)
This chapter is available at:
    University Press Scholarship Online

- Julie Berry Cullen, Steven G. Rivkin
DOI: 10.7208/chicago/9780226355344.003.0004
[school choice, special education, public school, Texas, individual education plan, special education students]
This chapter examines the impact of expanded school choice on the quality of special education services, on the size and composition of the special education sector, and on the distribution of students with disabilities among schools and districts. Using data from the Texas public school system, it investigates whether a school choice program can ensure that all (or most) schools have the resources to fulfill a student's individual education plan. The findings reveal that there is little evidence that regular education students attempt to avoid special education students and that special education students are disproportionately likely to make use of opportunities to choose among public schools. (pages 67 - 106)
This chapter is available at:
    University Press Scholarship Online

- Paul E. Peterson, William G. Howell, Patrick J. Wolf, David E. Campbell
DOI: 10.7208/chicago/9780226355344.003.0005
[school vouchers, standardized test achievement, New York City, Washington D.C., Dayton, Ohio, student test scores, parents' satisfaction]
This chapter compares the standardized test achievement of students who are randomly given and not given school vouchers in New York City, Washington D.C. and Dayton, Ohio, and discusses the key features of the randomized voucher distribution in these three locations. It also analyzes the programmatic impacts on student test scores, parents' satisfaction with their child's school, and parent reports of the characteristics of the schools the child attended. (pages 107 - 144)
This chapter is available at:
    University Press Scholarship Online

- Thomas J. Nechyba
DOI: 10.7208/chicago/9780226355344.003.0006
[school choice, public school system, housing, school consumption, private schools, public school quality]
This chapter discusses the factors to consider in introducing a school choice program in multidistrict public school systems. It highlights the importance of modeling the current school system realistically before attempting to predict the effects of school choice, and provides evidence on the link between housing and school consumption and the impact that private schools can have by severing this link. The analysis reveals that under the most pessimistic assumptions, increasing school choice may lead to surprisingly small declines in average public school quality and in the overall level of inequality in the system, whereas it may yield substantial gains under more optimistic assumptions. (pages 145 - 194)
This chapter is available at:
    University Press Scholarship Online

- Raquel Fernández, Richard Rogerson
DOI: 10.7208/chicago/9780226355344.003.0007
[school voucher, income redistribution, quality of education, power-equalizing vouchers, investments in education, school finance]
This chapter examines the consequences of several school voucher programs that serve to redistribute income in a manner which affects the distribution of the quality of education across students. It considers three voucher programs: the lump-sum, means-tested, and means-equalizing voucher programs. The analysis reveals that vouchers, especially the power-equalizing vouchers, generate large increases in a nation's income and well-being. This is because they generate more optimal investments in education than any version of current school finance operating at the district level could. (pages 195 - 226)
This chapter is available at:
    University Press Scholarship Online

- Dennis Epple, Richard Romano
DOI: 10.7208/chicago/9780226355344.003.0008
[neighborhood system, public school, school choice, intradistrict choice, segregation of students]
This chapter examines the implications of a neighborhood system of public schooling and compares it to provision that allows districtwide open enrollment or school choice. It shows that there is an important trade-off between intradistrict choice and neighborhood schools, so long as every student benefits from being with students of higher ability. The chapter explains that intradistrict choice encourages segregation of students on the basis of ability, but discourages segregation of students on the basis of income. (pages 227 - 286)
This chapter is available at:
    University Press Scholarship Online

- Caroline M. Hoxby
DOI: 10.7208/chicago/9780226355344.003.0009
[school choice, school productivity, vouchers, charter schools, underperforming schools, academic achievement]
This chapter investigates whether school choice can improve school productivity. It explains the economic logic which suggests that choice will affect productivity, and provides evidence on the relation between school choice and school productivity. The chapter analyzes the academic achievement and school productivity effects of three school choice reforms in the U.S.: the vouchers in Milwaukee, Wisconsin; charter schools in Michigan; and charter schools in Arizona. The analysis reveals that the schools which lost students under choice were schools that were underperforming when the choice programs were enacted. (pages 287 - 342)
This chapter is available at:
    University Press Scholarship Online


Author Index

Subject Index