Roger Thayer Stone Center For Latin American Studies

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School Vouchers: What Louisiana can Learn from Chile

By Ludovico Feoli

In light of Governor Jindal’s proposal to vastly expand Louisiana’s school voucher system it might be useful to consider the track record of similar programs elsewhere. To that effect, Chile’s experience might be informative. Starting in the 1980s that country implemented the world’s farthest reaching neoliberal reform of education. The Pinochet regime intended to revolutionize vast spheres of Chilean society by replacing professional and bureaucratic organization with market forces. In a nutshell, the logic behind educational choice was that the freedom of voucher-bearing parents to select schools would create competitive forces, generating incentives for schools to improve their performance, reduce their costs, and introduce greater innovation. Did it work?

While the evidence is complex, analysts suggest that “The Chilean reforms of the 1980s were not practicable, did not turn education upside down, and did not dramatically improve school performance” (Gauri 1998, 103). The reforms did not reduce inequalities in education: most poor children attend public schools, which have lower performance than private schools and are more poorly funded, due to their inability to charge tuition or surcharges, both of which are open to their private counterparts (Levin 2011, 74; Economist 2011). The reforms did not improve performance either. While standardized scores have improved in Chile over time, it is more likely to have been as a result of improvement efforts spearheaded by the Ministry of Education, not market forces. Scores are better in Chile than they are in other Latin American countries, but they are well below the OECD average and show high variability relative to student background. In fact, what vouchers do seem to have accomplished is a redistribution of pupils with better-educated parents from public to private schools. And while private subsidized schools seem to have lower costs than the public schools, this may be due to their free riding on the public education system–by not taking special needs students, and by hiring teachers already employed in nearby public schools as part-time faculty (Carnoy 1998). The prolonged student protests that have paralyzed the country in past months are testament to a widespread discontent with the educational system.

While it is clear that there are many institutional and even cultural differences between the education systems in the United States and Chile, these results should at the very least call for caution. As Gauri (1998) suggests, there are several lessons that can be drawn from this experience for a broader context. First, it is illusory to believe that markets will replace bureaucrats. To be sure, bureaucracies tend towards hypertrophy and can be paragons of inefficiency. But markets are also plagued by imperfections, like asymmetries of information, which allow parents that are better informed about school quality and performance, usually the more affluent, to reap greater rewards from the voucher system. Leveling the playing field by evaluating and disseminating educational achievement, and keeping schools financially accountable, requires increased regulation and state intervention. This points to an ironic paradox inherent in such market liberalizing reforms.

Second, markets are not immune to politics. If vouchers lead students away from existent public schools their remaining constituents–teachers, parents, staff, students, neighbors–will resist closures, creating political unrest and impeding cost reductions. Moreover, the complexity of educational reform is such that policies cannot be imposed by fiat. Not even the Pinochet regime could override longstanding traditions tied to the influence of teachers. There is no universal model that fits the needs of every community. Parents differ in their priorities and they are often willing to trade other aspects, like safety, convenience, day care, and instruction in religious or moral codes, for some degree of academic achievement or educational innovation (Gauri 1998, 105). Deliberation and consensus building are crucial for the success of educational policy.

While the Louisiana voucher expansion has been presented as a ticket for children to escape from failing public schools, the Chilean precedent warns against expecting this to emerge solely from market forces. Unfortunately, this expectation seems to be at the heart of the proposal given its broad eligibility requirements for students and its lax eligibility requirements for schools. Under the proposed rules students in more than 70% of Louisiana’s schools (55% of the public school students) would be eligible for vouchers (BGR 2012). At the same time, virtually all private schools meeting minimal requirements for operation could accept them. What is to prevent a student from entering a worse private school than the public one she is exiting? In the absence of regulations the assumption must be that the demand for quality education will draw parents to the best performing schools. Yet, this in turn assumes the existence of perfect information–available, intelligible, and unambiguous—which the new legislation makes no effort to impose. As the case of Chile exemplifies, an active administration is inevitable: to assure vouchers go only to those students who need them; to control that only highly qualified private schools can accept those students; to measure educational achievement in schools and to make the results widely available to parents; and to keep schools accountable for their educational and financial results over time.

The Chilean case, where tuition vouchers have been more extensively tried than anywhere, shows that private schools are not necessarily better than public ones, and that competition between public and private schools will not necessarily raise the quality of education or reduce its costs. “For those concerned with the quality and cost of education in the United States, the answers lie elsewhere” (Carnoy 1998).
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BGR. Making Choice Right: Can Private School Vouchers Live Up to Their Promises? (March 2012).
Carnoy, Martin. “Do Vouchers Improve Education?” Dollars & Sense, no. 216 (1998): 24-27.
Gauri, Varun. School Choice in Chile: Two Decades of Educational Reform. Pitt Latin American Series. Pittsburgh, Pa: University of Pittsburgh Press, 1998.
Levin, Ben. “Chile, Latin America, and Inequality in Education.” Phi Delta Kappan 93, no. 2 (2011): 74-75.
“We Want the World; Education in Chile.” The Economist 400, no. 8746 (2011): 36.

ABOUT THE AUTHOR

  • Ludovico Feoli

    Executive Director - Center for Inter-American Policy & Research

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