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The Reform Debate, Part II: The Difference Between Charter and Voucher Schools

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This post picks up where the last one leaves off on the debate among Matt Barnum, Jay Greene, and Neerav Kingsland about the regulation of charter schools and private schools receiving vouchers. I argued that there seem to be significant disagreements within the reform family on the regulation question. Here, I'm going to argue that the effects of regulation probably differ for charter and vouchers, so there are actually many related debates here.

To rehash, Jay's argument is that regulations drive many high-quality schools out of choice programs, thereby preventing families from accessing them. He is probably at least partly correct that regulation reduces the number of private schools willing to accept vouchers. Private schools have their established ways of doing things and are likely to view regulation as a serious infringement. They also have traditions and reputations to uphold and alumni support to maintain. Why sacrifice that existing base of support to accept a small number of students?

In contrast, charter schools are starting from scratch. No tradition to uphold. No alumni to satisfy. And since they receive essentially all of their revenue from the government they are probably more inclined to accept regulation. In Jay Greene's words, charter operators are more "compliant" than private schools.

But this last point highlights a key complication. Charter schools often receive more funding per pupil than private schools get with vouchers (although this varies considerably across states) and they are almost completely dependent on that government funding. This makes it even less likely that private schools will want to participate. Why allow the government to upend their way of doing things if the funding is low and they can carry on without it? For private schools, the cost-benefit calculation is less favorable.

Equally important is the question of which schools will be driven out? The highest-performing private schools are probably least likely to accept vouchers regardless of regulation because some of the prime attractions of private schools are their elite reputations, networking opportunities, and peer effects. For private schools with relatively high tuition and costs, which we might instinctively think of as high quality, the low voucher funding level is even more problematic because it covers a smaller share of (marginal) costs.

This is mostly theory and there isn't much evidence on either side. The study Jay cites by Brian Kisida, Patrick J. Wolf, and Evan Rhinesmith is interesting, but what they show is that regulation is not the top concern among private schools—that would be the stability of the program. It's also not the second biggest concernthat would be size of the voucher, reinforcing the idea that schools are weighing the costs and benefits. Also, surveys don't really tell us a lot about the real-world effect of regulation. What we'd want to see is an analysis of the relationship between private school voucher participation and private school quality, before and after regulatory changes. But that's almost impossible because, ironically, private schools are rarely required to report the student outcome data we would need to measure quality (Louisiana is a partial exception).

So, I'll concede the point that regulation reduces the supply of private schools willing to accept vouchers. I think supporters of regulation would probably concede this as well since a key purpose of the regulation is precisely to keep schools out that are either low-performing and/or unwilling to serve disadvantaged students.  Moreover, it looks like the effect of regulation will be even more pronounced among high-tuition private schools for whom regulation will be more of an imposition.

Will regulation reduce the supply of charter schools? Here the answer seems less clear. Remember there are many reasons to expect charter school operators to see regulation as less of an imposition. And this seems to be borne out in real-world policy responses: Anecdotally, when charter caps are lifted, more charter schools seem to open. When charter authorizers say they are taking applications, they get more applications than they can handle. At this point, the willingness of charter operators to open schools doesn't seem like a big issue.

So, this reform family debate among Jay Greene, Neerav Kingsland, and Matt Barnum now seems like four connected debates:

  • Will regulation reduce the total number of charter suppliers? Probably some, but that doesn't seem like a problem at present.
  • Will regulation reduce the total number of private schools accepting vouchers? Very likely yes.
  • Will regulation reduce the number of quality charters? Probably not and it would likely increase the share of charter schools that are high-quality if we support the government/authorizer quality measures.
  • Will regulation reduce the number of quality private schools accepting vouchers? Very likely yes, if reputation and tuition levels are good proxies for quality, If not, the effect is unclear.  

Yes, these family squabbles are usually more complicated than they seem. Maybe there's no disagreement at all and they are just arguing different points.

Post-Script: I need to clarify one thing I wrote in the last post: I said Jay was assuming the regulator had the burden of proof for taking decisions out of the hands of families. I still think that was accurate. However, I wrapped that into a comment that Neerav Kingsland's arguments were more empirical, giving the impression that Jay wasn't considering the evidence. That's not the case. Jay actually goes to great lengths to consider the evidence, including the survey of private schools discussed above. But my point is that he is interpreting that evidence based on a philosophy that parental choice takes precedence and that the burden is on the regulator to show that the regulations are effective. That might seem like a small point, but I think it's important to understanding Jay's argument.

To further reinforce this point, I'll be discussing in one of the next posts the ample evidence Jay mentioned. It's also impossible to write about regulation and charter schools without considering the Eva Moskowitz/Success Academy situation and Senator Clinton's recent criticism of charter cream-skimming. 

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