MARKETS VERSUS MONOPOLIES
IN EDUCATION

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     The material cited on this page argues that free markets for educational services have consistently done a better job of serving the public than government-run school systems, whether the governments in question have been dictatorships or democracies.
     This does not mean that all private schools are superior to all public schools. It is entirely possible for a private school to be unresponsive to parents, to use ineffective pedagogical methods, or to allow its facilities to decay. What distinguishes competitive markets from state schooling is the incentive structure that discourages private schools from succumbing to these failings, and encourages them to ascertain and serve the needs of families.
     The idea of reintroducing a free market in education has many critics. A sampling of their views can be found on the Criticism of School Choice page.

     The Book Review section follows, and a list of links to relevant articles appears at the bottom of the page.

Book Reviews

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Reclaiming Education

James Tooley (Cassell, 2000)

     Most education policy discussions revolve around the merits of this or that reform to our existing public schools, failing to even consider alternative education systems. These discussions are rendered moot by the far more profound analysis presented in Reclaiming Education. With this work, James Tooley addresses a question that few other scholars have had the vision or the expertise to ask: What sort of education system will best serve the public? The cogency of his answer and the soundness of the evidence and arguments on which it is based make Reclaiming Education one of the finest and most important books on education policy ever written....   <Click here for the full review>

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Market Education:
The Unknown History

Andrew J. Coulson (Transaction Publishers, 1999)

     Market Education is the culmination of five years of full-time research on a single question: What sort of school systems best fulfill the public's educational goals--at both the individual and the societal level? It is perhaps the most comprehensive investigation of school governance ever undertaken, comparing educational systems from all over the world and from ancient times to the present. To find out more about this book, click here.


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Decentralization of Education

Harry Patrinos and
David Ariasingam (The World Bank, 1997)

    Despite its brevity (running to just 50 pages), Decentralization of Education is an important book. It describes the World Bank's foray into "demand-side financing," the practice of providing families with financial assistance so that they can purchase educational services in the private sector (rather than having governments own and operate schools). The various case studies discussed reach from the Dominican Republic to Pakistan, revealing just how widespread the practice has become, and how effectively it is reaching even the poorest families.
     The book's chief weakness is that it does not seize the opportunity to apply the lessons of its case studies to its review of the academic literature on school choice. The first section of the book is a digest of the (mostly theoretical) arguments that have been made for and against school choice. Since a large portion of this literature is badly reasoned and devoid of supporting evidence, it is frustrating that the authors did not apply what the World Bank is learning about demand-side financing to a critical assessment of the arguments pro and con.
     It is also somewhat unfortunate that the book takes for granted a major funding role for the state in education, rather than exploring predominantly or entirely non-governmental sources of funding. This, however, is only to be expected given that the World Bank is itself primarily an inter-governmental organization.
     These caveats aside, Decentralization of Education adds a much needed dose of empiricism to the question of markets versus monopolies in education.


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The Global Education
Industry

James Tooley (Institute for Economic Affairs, 1999)

     Buy and read this book immediately. Unlike the vast majority of works on education policy, Global Education Industry is based on good old fashioned field research. Tooley and his colleagues traveled the world to study the merits of competitive private education businesses from Brazil, to Zimbabwe, to India. What they found were schools so dynamic, so innovative, and even so technologically advanced that they put to shame the government-run schools of most developed nations. Even some of the highly-regarded non-profit private schools of developed nations seem stodgy, slothful, if not outright backward compared to the educational businesses investigated in Global Education. The competitive market for schools found to work so well throughout history (see review of Market Education below)  is here found to be serving large and diverse communities in comparatively poor countries all over the world.  To find out more about this book, click here, or read a paper by the author entitled "Should the Private Sector Profit from Education?"


Separating School and State Separating School and State

Sheldon Richman (Fairfax, Virginia: The Future of Freedom Foundation, 1994)

     Richman summarizes the less-than-illustrious origins of government schooling, shows how opponents of state-run schools have been wrongly portrayed as opponents of education, identifies many of the key flaws in the organization of public education, and argues for the complete deregulation and privatization of schooling. The book's chief weakness, its extreme brevity, is also its strength, for it allows the author to provide a clear and concise introduction to the issues involved. The book also would have benefited from a more thorough treatment of the education of children from poor families, particularly non-government methods of subsidizing that education.


Education and the State Education and the State--3rd edition

Edwin G. West (Indianapolis: Liberty Fund, 1994)

     Originally Published in 1965, Education and the State was the first empirical work to compare free educational markets to government-run school systems. The book examines 19th century English education in considerable detail, demonstrating that literacy and school enrollment rates were high and still rapidly growing in the early eighteen-hundreds when schools operated in a free and competitive market. It also shows how government intervention did nothing to improve the existing growth in these areas. A new fifth section of the third edition explores the history of government intervention in the United States during the nineteenth century, observing that increasing state government education subsidies simply discouraged preexisting local private donations, and failed to increase the overall amount of spending on education. Education and the State remains one of the best books on the subject after more than three decades.

Articles

How Markets Affect Quality:
Testing a Theory of Market Education
Against the International Evidence

by Andrew J. Coulson, May 2003

This paper uses evidence from developing countries around the world to test Coulson's conclusions from his book Market Education: The Unknown History. Do parental choice and direct financial responsibility, along with freedom, competition, and the profit motive for schools, really lead to superior educational conditions and outcomes? The answer to that question is fascinating.

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Implementing "Education for All":
Moving from Goals to Action

by Andrew J. Coulson, May 2003

The international community is committed to the goal of getting all children in less developed countries into school by the year 2015. The original target was to achieve that goal by the year 2000. That original target was missed, and the new target is likely to be missed in many countries. What specific policies can developing nations pursue that is likely to improve their chances of success?

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Should the Private Sector Profit from Education

by James N. Tooley

     Professor Tooley uses his research into private schools from around the world to show that market incentives, including the profit motive, are crucial ingredients for educational excellence. He argues that children and families profit from competitive educational markets.

Public Schooling Vs. Public Education

by Andrew J. Coulson

     Draws a critical distinction between the goals of public education, which we all share, and the particular institution of public schooling, which is just one mechanism for achieving those goals. Argues that centrally planned state-run school systems are not in fact the best way of fulfilling our ideals of public education.

The Case for School Choice

by Claudia Rebanks Hepburn

     This 1999 report draws together evidence from the United States, New Zealand, Denmark, and Sweden to show how increased parental choice and competition between schools have improved educational quality in those nations. Claudia Hepburn is head of the Toronto office of the highly respected Fraser Institute.

Markets Versus Monopolies in Education:
The Historical Evidence


by Andrew J. Coulson

     See review on the History page.

Education with and without the State

by Edwin G. West

     Professor Edwin West is one of the world's foremost economists of education. Thirty years after its original publication, his book "Education and the State" (Liberty Fund, 1994, 3rd edition) remains the best empirical work comparing free educational markets with government school systems. In the present paper, West compares the 19th century experiences of prosperous modern nations with the current experiences of "developing" countries. He finds that in both contexts, education spreads naturally and has a beneficial effect on living standards, whether or not government is involved in schooling. Several other relevant issues (such as the effects of non-profit versus for-profit organizations) are discussed.

Public Schools: Make them Private

By: Milton Friedman

     "Our elementary and secondary educational system needs to be radically restructured. Such a reconstruction can be achieved only by privatizing a major segment of the educational system--i.e., by enabling a private, for-profit industry to develop that will provide a wide variety of learning opportunities and offer effective competition to public schools." --From the article's executive summary.

The Weak Case for Public Schooling

     David Friedman on the economic reasons for avoiding government involvement in education.

Complete Books on the Web

Privatization and Educational Choice Privatization and Educational Choice

Read the full text!

Myron Lieberman (New York: St. Martins Press, 1989)

     This book takes on many issues related to the privatization of schooling. It examines contracting out by public school boards to private education service providers, discusses vouchers and parental choice, and compares markets and government regulations as safeguards of student interests.

Books Reviewed at Other Websites

Privatization and Educational Choice (1989)

Liberating Schools: Education in the Inner City (1990)

 

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