Voucher viability

Tuition
Two conditions that justify government intervention in a market are the presence of
external benefits and equity concerns. Both of these issues are present in the case of
primary and secondary education in the United States. Think about what education
without government education would look like. In the absence of government
intervention, all primary and secondary education in the US would be private. Public
school districts would not exist. Parents would need to pay private firms (schools) to
educate their children.
External benefits
If all education were private, it’s likely that people would buy too little education, from
society’s point of view. External benefits are one reason. When a child is educated, he
or she benefits and we expect his or her parents to take those benefits into account
when they purchase education.
But there are additional benefits to society which parents may ignore. As people
become more educated, they are less likely to be unemployed or be criminals and are
more likely to volunteer and vote. The presence of these external benefits is an example
in support for the government getting involved in education.
Equity
Many families in the United States have low incomes. Among all children in first through
twelfth grades in 2001, 46% were from families with incomes below $40,000. Since the
cost of private education would be an important share of these families’ incomes, most
Americans would be concerned about the fairness of relying on markets to decide how
much education children receive. Current spending by these families on private
education provides some support for this concern. Of all children in private school in
2001, only 25% were from families with incomes below $40,000. Therefore, equity
concerns are another example in support for government getting involved in education.
Providing vs. producing education
Most economists think external benefits and equity concerns justify government
intervention in education. But it is important to distinguish between government
production of education and other forms of government intervention. At the level of
elementary and secondary education, K- 12 education, government intervention today
mostly means production of education by local school districts. To benefit, children
must attend public schools. But this is not the only form intervention could take.
There are other markets where government intervention takes the form of subsidizing
people’s access to products—think of financial aid to college students, for example.
Many people in the US think that government should move from producing education
to subsidizing access.
One form that subsidy could take is government providing vouchers to parents.
Parents would use the voucher to help pay for their child’s education in a private
school. After it receives the voucher, the school would turn it in and be paid by a local
or state government.
Today there is a lively debate between people who think K-12 education should be
delivered publicly and people who think quality and efficiency would be higher if
government provided vouchers and the education was delivered by private schools.
Some of these quality and efficiency arguments can be based on material we covered
this week. Price competition between private schools will pressure each one to produce
efficiently. Competition for students will lead private schools to offer programs of interest
to parents and their children.
Answer the questions below and make use of the sources supplied. Be sure to cite you
sources in your answers.
1. Explain whether a potential exit by students with vouchers will lead to the
improvement of public schools.
2. Discuss whether the implementation of vouchers will lead the best students to
leave public school, which could lead to a decline in education for the students
left behind in the public schools.
3. Consider what might happen to the students who use vouchers to leave public
schools in order to attend private schools. How might their academic
performance change as a result of switching?
4. Finally, think about the impact of a voucher system on the students in an
urban setting. Describe whether all families would have an equal opportunity
to access education.
Your final product will be a paper that:
 Addresses each of the four questions above in total.
 Is APA formatted.
 The body is to be 2 pages minimum.
The requirements for your assignment are:
1. Answer each question fully
2. Define the overall subject of each question.
3. Cite at least three (3) resources from this week’s materials