Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Tuesday, December 14, 2004

Vouchers, Choice, and Schooling

Many economists since Milton Friedman have argued that if the gubmnt is to support education, it should do so via vouchers rather than direct grants to school boards. Vouchers would let parents choose the school for their children and would foster competition for customers on the part of the schools (click here for a good summary). Vouchers would also allow parents to top up the payments if they wanted something a little better than what the basic voucher would buy.

We have something roughly approaching the voucher system in Ontario. First, at the university level, students are free to choose whatever university will admit them, and admission is merit-based; there are no out-of-province extra fees (we do sock it to international students, however), so it's like a nation-wide voucher system for universities. In Ontario alone, students can choose to attend one of several major universities, numerous lesser institutions, or a multitude of community colleges. If one of them isn't serving the customers adequately, their enrolment will surely drop.

Even at the elementary and secondary levels, we have more choice for "free" education than in the U.S. In Ontario, both the public and the separate (i.e., Roman Catholic) schools are funded by the gubmnt, and if parents don't like the offerings of one school, they readily switch their children to the other system. Contrast this with what Bill Sjostrom found when he was a student in Chicago.

Recently the province instituted some tax breaks for parents who want to send their children to private schools that are not funded directly by the province, making these other schools more viable competitors. For a very extensive analysis, see this excellent piece by Bill Robson and Claudia Hepburn. The Ontario tax credit scheme isn't a voucher system, but it does help promote choice and competition in the provision of education. And this partial voucherization of Ontario's schools probably addresses many of the concerns that Tyler Cowen has about the use of vouchers for education.

UPDATE: In addition to his comments here, see more on what Tom has to say at his website -- some very interesting useful information.
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