Market Competition and School Vouchers

Authored by: Henry M. Levin

Handbook of Research on School Choice

Print publication date:  June  2019
Online publication date:  June  2019

Print ISBN: 9780815381464
eBook ISBN: 9781351210447
Adobe ISBN:


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Milton Friedman’s essay (1962) on the role of government in education is a fascinating analysis of the rationale for government funding of basic education as well as the mechanism to do so, the voucher. Friedman proposes that capitalism provides a competitive marketplace in which Libertarian principles would enable families to choose their preferred schools and pay for them with a government voucher. In this context of choice, Friedman would also require compulsory education for all students in schools approved for teaching them the common values and behaviors necessary for adulthood in a democracy. He does not provide any specific evidence from or analysis of educational markets, nor does he pose specific details on how schools are approved for vouchers by fulfilling their roles in sustaining democracy and social cohesion. He argues that the voucher system will increase freedom of choice and equity by giving all families choice, although he would allow schools to charge families to pay additional fees to gain better education than could be provided with the basic voucher. This chapter compares the assumptions that define a competitive marketplace with the challenges of an educational marketplace in meeting these assumptions. Clearly freedom of choice would be enhanced by a voucher plan, but there is little evidence of greater educational productivity in the use of resources, improved equity, and the generation of social cohesion.

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