A Libertarian Perspective on Economic and Social Policy

Lecture 10

Public Schools and Accountability

©2007 Jeffrey A. Miron

Introduction

• In recent decades there has been substantial criticism of public schools (K-12).

• To Libertarians, the “solution” to these problems is “obvious”: – Eliminate public schools and government involvement in

education, with the possible exception of means-tested vouchers for youngest kids.

• No matter how compelling one finds the libertarian perspective, however, the libertarian approach is unlikely to occur any time in the near future.

• So, it is reasonable to ask whether there are ways to improve public schools within more or less the current framework.

Introduction, continued

• The standard liberal proposals require substantial increases in government expenditure on education:– More teachers per student;– Higher pay for teachers.

• The conservative response is that more money is not the answer;

• Instead, policy should introduce accountability and/or competition:– High-stakes testing of students– Testing and certification of teachers– Charter schools– Vouchers

Introduction, continued

• At first blush, many of these “fixes” sound appealing:– Who can object to accountability?– What economist can object to more

competition?

• This lecture suggests, however, that some of the conservative (“market oriented”) approaches to fixing public schools might not be as promising as they appear.

Introduction, continued

• In particular, the lecture addresses the merits of accountability versus increased competition:

• There are reasons increased accountability might help. – But the benefit is not obviously large, and

accountability might cause substantial harm.– So, libertarians should be cautious in jumping on the

“accountability” bandwagon.

• Increased competition is almost certainly a plus.– But its benefits are often oversold.– And accountability is not equivalent to competition.

Outline

• What is the Problem with Public Schools?

• Market Approaches to Improving Public Schools

• Potential Problems with Accountability

• Alternative Approaches: Cutting Costs

• Accountability versus Competition

What is the Problem with Public Schools?

• There are two basic criticisms of public schools in the U.S.:– Low and/or declining test scores.– High and/or increasing costs.

• There is relatively little dispute about these facts, and most observers agree there is a problem to be addressed.

• The disagreement is over how to fix it.

The Liberal Approach to Improving Public Schools

• The standard liberal view of the current problem is a combination of two issues:– Class sizes are allegedly too big– Teacher salaries are allegedly too low

• The proposed solutions therefore involve spending more money on each of these two things, plus possibly on items such as computers, internet access, etc.

“Market” Approaches to Improving Public Schools, I

• The market response to the current situation is that adding additional resources is not the answer:– After all, resources have grown immensely over the

past several decades, yet there is no evidence of improved results.

– Relatedly, numerous studies of the relation between expenditure per pupil and educational output (e.g., test scores) find little or no evidence that spending more money helps.

– Indeed, many of the worst performing school systems have the highest expenditure per pupil.

“Market” Approaches to Improving Public Schools, II

• Thus, the “market” view suggests two main categories of improved policies:– Accountability via high-stakes testing.– Increased competition via charters and/or vouchers.

• It is useful to focus first on the accountability approach.

• The basic premise of this approach is that schools perform poorly because no one pays a penalty when educational results are bad.– For example, teachers do not get fired even if their

students have learned nothing.

What is the Accountability Approach?

• The key component of accountability systems is a state-wide test given to students in one or more grades:– Students in various grades sit for the state-wide

exams.– The state publishes the results of these tests on a

school-by-school basis (report cards on schools).– The state in some cases provides explicit monetary

rewards or penalties to teachers, principals, districts, and the like based on the scores.

– The state in some cases makes receipt of a high-school diploma conditional on passing, say, the 10th grade state-wide test.

Accountability, continued

• These systems are also known as high-stakes testing.

• These have been adopted mainly since the early 1990s and now exist in most states; required in all states by 2006 as part of No Child Left Behind.

• The theory behind accountability is simple:– Students will study harder, and teachers will teach

better, because of the rewards and punishments.– The rewards and punishment need not even be

monetary; reputations matter as well.

Evidence on Accountability

• Existing research documents that accountability is associated with higher test scores.

• The magnitude of the improvements varies across studies:– In some cases they seem large (perhaps too large);– In other cases they seem modest although not trivial.

• And these need to be evaluated carefully: – Pass rates versus average scores.– Increased expectations by teachers and increased

efforts by students can potentially produce large improvements in results even with no change in learning or skills.

Evidence on Accountability, continued

• But prima facie, it goes in the desired direction.• Existing research also shows that the direct

costs of accountability systems (e.g., designing and administering the tests) are minor.

• Thus, if these are the only two issues that matter (roughly, test scores per dollar of expenditure), then current evidence makes a serious case for accountability.

• But, I will argue in a moment, accountability has potentially serious negatives.

Potential Problems with Accountability, I

• Schools are accountable to some degree without state intervention.

• Parents, students, and teachers all encourage quality in some cases:– Parents vote with their feet by locating in better school districts.– Students migrate to better teachers.– Good teachers provide an good example and/or put pressure on

bad teachers.

• Relatedly, test scores were available long before accountability came on the scene.

• Thus, the basic premises of accountability are easily overstated.

Problems with Accountability, II

• A basic premise of the accountability approach is that there are better ways of running schools that are not currently being used.

• Yet according to existing research, school quality or characteristics often have minimal impacts on educational outcomes.

• So, it is not obvious what these better ways of running schools are.

• Thus, the potential gain from accountability might be small.

Problems with Accountability, III

• One possible response to accountability is increased classification of students as learning disabled or non-English-proficient:– The scores for these students are not included in the

“report cards,” so scores appear to increase on average even if individual scores do not change.

– There is good evidence this occurs to a non-trivial degree.

• The good studies control for this in assessing the impact of accountability on test scores.

• But reclassification can still have adverse effects on the students who have been reclassified.

Problems with Accountability, IV

• A second possible response to accountability is cheating:– Changing student answers– Telling poor students to stay home on test day– Losing/invalidating exams from poor students– Answering questions about test content– …. Many other examples.

• Existing evidence finds non-trivial evidence of this.– This is not surprising: the incentives are substantial.

• And even if the effect on average scores is minor, the atmosphere created is undesirable.

Problems with Accountability, V

• Still a different possible concern is “teaching to the test.”

• The degree to which this is a problem depends on the test and the nature of the response:– At one extreme, it means teachers spend more time

on learning and less time on recess.– At the other extreme, it means student practice filling

in the holes on Scantron sheets.• More broadly, teaching to the test can mean

there is lots of attention to test-specific items at the expense of more fundamental ideas or non-tested subjects (science, history).

Problems with Accountability, VI

• Beyond all these issues, the accountability framework imposes one, specific approach to education on everyone:

• To begin even given the emphasis on test scores, it says that what matters is the performance of, say, the 20-40th percentile, i.e., those at risk of failure.– What if the emphasis on this group harms those

above and below?– What if this approach encourages a general watering

down of the curriculum?

Problems with Accountability, VII

• Finally, but perhaps most importantly, accountability assumes the right measure of “good schooling” is test scores:– This is presumably one thing we care about, but it’s

not the only thing.– Another key issue might be facilitating a good match

between student skills and student programs, such as sending some students to college prep but others to voc/tech.

– Accountability says the same program is right for everyone; this is insane.

Problems with Accountability, VIII

• More broadly, the accountability approach attempts to fix problems caused by bad government with more government.

• There is no evidence this approach has ever been successful in any area of public policy.

• And, the right question is not just, – “Is accountability working now.”

• The right question is, – “Will accountability be a good thing after it has been

modified, expanded, manipulated, and captured by all the relevant interest groups.”

Will Accountability Work Well Over the Long Haul?

• My answer is an emphatic no.• The tests will get weaker so that almost everyone

passes.• Schools will discover myriad more ways to reclassify,

cheat, and the like, without material changes in the quality of teaching.

• The homogenization encouraged by accountability will only increase.

• And the failures that do continue will be used to justify more expenditure.

• In short, there will be lots of costs and minimal if any benefits.

Alternative Approaches to Improving Public Schools, I

• The accountability approach attempts to improve the “productivity” of public schools, as measured by, say, test score per dollar spent, by increasing the numerator, i.e., by raising test scores.

• A different way to improve the ratio is to reduce the denominator:– That is, find ways to reduce costs that do not lead to

declines in quality.

• There are several possibilities.

Reducing Costs Without Reducing Quality

• Eliminate barriers to entry in teaching:– In most states, public school teachers must be

certified and must complete training in “education.”– There is no evidence this training has a beneficial

impact on teacher quality; indeed, it might be counterproductive, and in any event it raises the costs of becoming a teacher, thereby discouraging entry.

– If each public school district, or each public school, were free to make its own decisions about hiring qualifications, there would be a larger supply of qualified teacher, thereby lowering costs.

– Thus, contrary to frequent assertions that the solution is higher teacher salaries, there is substantial scope to increase quality while actually saving money.

Reducing Costs Without Reducing Quality, continued

• Eliminate counter-productive regulation– Both state and federal governments impose

regulation that fails to increase quality and even lowers quality.

– A good example is bilingual education.– This approach requires additional resources,

yet there is no evidence it improves outcomes and probably hurts to some degree.

– The federal regulation is particularly bad, since it limits experimentation by states.

Reducing Costs Without Reducing Quality, continued

• Eliminate teachers unions:– This is hard under current federal and most state law.

In practice, not much can be done.– But remember that accountability does not eliminate

teachers unions, which can and do attempt to undo accountability and at least sometimes succeed.

• Reduce the size of school districts:– In some places, there is little competition between

districts; in others, lots.– Simply splitting up districts is a cheap way to reduce

inefficiency.

Reducing Costs Versus Increasing Quality

• The bottom line is that there are several ways to improve productivity that will almost certainly work.

• They have little political appeal because they do not promise improved learning, only a cheaper price tag.

• But that might be the best we can do, at least taking the basic public school framework as given.

Accountability Versus Competition

• The other key component of the “market” approach to improving public education is allowing more competition:– Charters– Vouchers

• As discussed earlier, this approach is sometimes oversold as well, but the theory and evidence suggest three effects:– Modestly higher test scores– Substantially higher utility– Substantially lower costs.

Accountability Versus Competition, continued

• Thus, to some degree, the “competition” approach is similar to the “cost-cutting” approach:– It is unlikely to produce dramatic improvements in educational

outcomes, but it can improve productivity by lowering costs.• In contrast to both the accountability and cost-cutting

approaches, however, the competition approach fosters variety and innovation.

• It also enhances accountability, probably far better than high-stakes tests, by giving parents and students more choice over which schools the students attend.

• These factors make competition a clear winner over accountability, assuming political forces make it possible to implement.

• The only real debate is over political feasibility.

Conclusions

• One critical question about accountability is whether it enhances or detracts from other reforms such as vouchers, lower barriers to entry in teaching, …

• The other critical question is whether modifications will make accountability better or worse over time:

• As of right now, it’s hard to take a really strong stand based on existing evidence.

• But the history of government regulation suggests negative answers to both questions:– My forecast is that thoughtful advocates of competition and

market forces will rue the day they signed on to the accountability bandwagon.