The Power of Vouchers

Many studies of education vouchers have looked at the achievement of children who are given vouchers and who transfer to private schools.  Generally these studies have found small but meaningful improvements (e.g. here and here).  A voucher program, however, is about much more than transferring students from lousy public schools to better private schools it’s about creating incentives to improve the public schools.

Florida’s Opportunity Scholarship Program rated schools.  Students at schools that received an F in multiple years became eligible for a voucher that allowed them to attend a private or higher-rated public school.  In Feeling the Florida Heat? (ungated version) a paper sponsored by the Urban Institute Rouse et al. look at what happened at failing schools.

…we find that schools that received a grade of “F” in summer 2002 immediately improved the test scores of the next cohort of students, and that these test score improvements were not transitory, but rather remained in the longer term. We also find that “F”-graded schools engaged in systematically different changes in instructional policies and practices as a consequence of school accountability pressure, and that these policy changes may explain a significant share of the test score improvements (in some subject areas) associated with “F”-grade receipt.

Thus, this paper shows two things.  First, that the test scores of the students in the public schools improved when vouchers gave the schools better incentives to perform.  Second, at least some of the improvement comes from changes in how students are taught.  The author’s note, for example:

…we find that schools receiving an “F” grade are more likely to focus on low-performing students, lengthen the amount of time devoted to instruction, adopt different ways to organize the day and learning environment of the students and teachers, increase resources available to teachers…

It is not true that "nothing can be done to improve the schools."  Incentives matter.

Notice that Florida’s program worked even though the program was very weak.  It offered vouchers only to students in the worst schools and only after those schools received F grades in multiple years.  The vouchers were relatively small and could not be topped up.  In addition, the program lasted only a few years before it was declared unconstitutional by Florida’s supreme court.

A true voucher program would be national, would not discriminate among students, would offer funding equal to that spent on students in public schools and would be permanent. Competition in such a system would be more intense and even more productive than in Florida’s program.