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How Can Policy Support More Innovation in Education?

Note: Our guest-blogger this week is Anna J. Egalite, an Assistant Professor in the College of Education at North Carolina State University.

Human ingenuity has ensured progress in every sector of society. Robot surgeons can perform operations on pigs with minimal human supervision; Google has developed a fleet of self-driving cars; and it's only a matter of time until 3D printers progress beyond generating red-carpet-worthy dresses to producing actual human tissue. There's no reason to think education can't benefit from revolutionary discoveries and inventions too. Here's my prescription for an education policy that will spur serious innovation and greatly improve productivity: Education Savings Accounts (ESAs).

ESAs provide access to some or all of the funds that a state would have spent on a child's education. Parents are given control of a restricted bank account that can be accessed to pay for state-approved educational expenses. This enables a family to exercise private school choice, for instance, but it can also be used to make broader educational purchases such as hiring a private tutor, paying for a community college classes, or booking a certified therapist. Unused funds roll over from year to year and can be saved for college expenses when that time comes.

How is this different from school choice as we currently know it? ESAs represent a highly flexible funding model. Because the funds are entirely parent-directed and can be spent in a piecemeal fashion, ESAs allow families to assemble a highly customized basket of educational goods and services for a given child. To education researchers, this type of variation is particularly exciting because it makes it statistically possible to pinpoint particularly effective providers or resources.

Fiscal hawks are excited by ESAs because they incentivize parents to make educational choices with price in mind, in addition to perceptions of quality. Long term, this type of competitive pressure has the potential to boost productivity by incentivizing providers to offer the best services at the lowest cost.

For me, there are three things I find compelling about ESAs: 1) They represent a sustainable funding model that is likely to entice new providers into education and incentivize existing producers of education resources and services to dramatically scale up experimentation efforts and expand their offerings; 2) ESAs can tap into the wisdom of crowds by facilitating multi-sector, community wide partnerships, expanding our current vision of "public schooling" to a more inclusive definition of "public education;" and 3) Equity can be promoted by weighting the value of an ESA to account for student disadvantage or disability, making the most "challenging-to-educate" students the most desirable ones for providers to cater to.

In the coming years, it's going to be fascinating to watch the supply side dynamics in the five states that currently have legislation authorizing ESAs on the books. Policy wonks are already predicting that we'll see growth in websites such as GreatSchools that serve as the Yelp of educational services, but it's likely we'll see even greater innovation in the complementary services that develop as a result of ESAs. Something like an Edsy website (an educational analog to the Etsy website that connects home-based crafters to customers seeking unique and specialized goods) would allow teachers, writers, and instructional designers market and sell highly customized educational goods and services. Similarly, an analog to Grubhub could integrate small-scale educational providers into a mobile ecosystem by allowing their app to operate as a common platform, thus lowering up-front costs for small and new providers wishing to enter the educational marketplace.

The other thing I find compelling about ESAs is that educational reform in this type of environment would never be wholesale, unlike education reform in most school districts currently in which an entire district is automatically opted into a new policy or program. If a new and innovative experiment goes belly-up under an ESA, at least the ripple effects of one bad decision are limited to one single puddle, not the whole lake.

There is reason for optimism in education. In the short term, educators can use existing resources and people in new ways to grasp the low-hanging fruit. In the long run, however, ESAs represent one of our best hopes for promoting innovative solutions to persistent problems. 

--Anna Egalite 

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