Competition helps all

January 10th, 2014 at 4:00 pm by David Farrar

Eric Crampton writes:

A few years ago, Jerry Hausman showed that Wal-Mart does a lot to benefit even consumers who don’t shop there. When a Wal-Mart opens, competitor local supermarkets cut their prices to keep customers. And poor customers reap most of the benefits

Figlio and Hart, in the latest AEJ: Applied Economics, show a similar effect with school vouchersAn ungated version is here.

Suppose your worry about school vouchers is that low social capital parents’ stick with a local underperforming school while kids whose parents have better social capital all flee with their vouchers to the better private schools. And suppose further that you care way more about the potential losses to the former than about the gains for the latter. You might then oppose voucher systems.

Figlio and Hart show that public schools facing competitive pressure from private schools under a new voucher system provided stronger student score improvements. All that concern about kids left behind as the private schools cream off the best voucher kids? Not much of an issue if the public schools facing the competitive pressures perform better as consequence. They find the biggest positive effects in public schools facing strong financial incentives to retain low-income students.

There has also been studies showing that charter schools not only improve the performance of students at those schools, but neighbouring public schools improve their performance also.

For some strange reason, this is seen as a bad thing because it clashes with an ideology that competition is bad.

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Sounds great not controversial to me

September 7th, 2009 at 8:13 am by David Farrar

The Dom Post reports:

Prospective teachers could skip specialist university training and be fast-tracked into the classroom under a plan to cope with an ageing workforce.

Under the scheme, anyone who already has a master’s degree could bypass teacher’s college and learn on the job.

The suggestion follows a high-level meeting between Education Minister Anne Tolley and controversial United States schools leader Michelle Rhee.

Controversial is often applied by the media as a label for someone with views that journalists disagree with. It is a way of saying “Do not listen to this person”.

So before we look at what Rhee said, who is she. Is she some sort of academic whose has controversial theories never actually trialled?

Michelle Rhee is a 39 year old Korean-American who is the Chancellor of the DC Public Schools system. She is also the founder of The New Teacher Project that has recruited 10,000 teachers in the last ten years.

As Chancellor she is responsible for 168 schools, with around 58,000 students. 84% of her students are black.

So this “controversial” woman is in charge of the public schools of one of the poorest areas in America, and in an overwhelmingly Democratic area.

So what does she recommend:

The Washington DC schools chancellor has caused debate with proposals to give star teachers huge pay rises, fire ineffective ones and introduce a voucher system that gives pupils from low-income families thousands of dollars to attend private schools.

That sounds pretty good to me I have to say. The article actually has it wrong thought. She did not introduce the voucher system A voucher system for 1,900 low income families has been operating since 2004 (before she was appointed). She just does not oppose it.

Does she see it as undermining public education?

The five-year pilot program is up for renewal next year, but Ms. Rhee doesn’t see school choice as a threat to her mission in the public schools. She shakes her head. “I would never, as long as I am in this role, do anything to limit another parent’s ability to make a choice for their child. Ever.” Instead, she sees the competition presented by school choice and charter schools as part of the process of raising standards in the public school system at large. “We have an excellent choice dynamic for parents here… I’m a huge proponent of choice…” People have tried to get her to commit to a ratio of public schools to charter schools. Ms. Rhee won’t play that game. “I don’t enter this with defensiveness, about protecting [D.C. public schools'] share of the market. I believe we should proliferate what’s working and close down what’s not. Period

She doesn’t say that vouchers are the remedy for repairing public schools, she just says that choice is good and the answer to failing public schools is to close down the bad ones, and pay great teachers heaps more money.

I’ll be delighted if Anne Tolley moves in this direction. I’ll also be very surprised.

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Rodney Hide interview

May 9th, 2008 at 10:41 am by David Farrar

Scoop has an in depth interview with Rodney Hide. This is what I like about online media – one can see a full transcript. Some interesting extracts:

Campbell : So you consider yourself a libertarian?

Hide : Yeah.

Campbell : But you don’t regard taxation, in principle, as theft ?

Hide : I don’t see that argument helps. Saying that something is theft. Because technically. it isn’t. I understand that taxation is a compulsory taking – but its not theft in the sense that…however you look at it, Parliament has made it legal. It doesn’t make it right.

Campbell : So it is wrong in principle, but OK in law?

Hide : Having excessive tax of course is wrong in principle. But I don’t think saying that taxation is theft is correct. Our definition in New Zealand of what is theft is : what is against the law. And amazingly, our Parliament makes…you know, tax legal. I don’t think its on the cards that we could live in a totally voluntary society, where there is no tax.

Don’t tell Lindsay Perigo that Rodney called himself a libertarian, but I think he gets it right when he says some tax is okay, but excessive taxation is wrong. Taxation is a privilege, not a right!

Campbell : I’ll re-phrase. Do you see human beings as being responsible for the global warming that the IPCC sees as occurring right now ?

Hide : OK, that’s a better question. Um… whether its anthropogenic. I think there is an influence. I think its arguable how much. And that’s not clear. We do not know the exact influence that humans have had on the world’s climate. It requires a theoretical understanding largely based on models. If we accept the IPCC – which isn’t a bad starting point, right? The political question is what then do we do? I think that has two components. The first is that we have to worry seriously about our trade, and our international standing because we could find ourselves very easily shut out of the world. Which would be horrific. So we’ve got to be, to use the phrase, ‘ global citizens’ on this one. I think Kyoto One was a mistake.

It is worth reading the full exchange. Like the religion it has become, Rodney was asked if he “believes” in global warming. He refused to play ball and kept pointing out the wrong questions were being asked until a sensible question was asked.

Campbell : Some people use private schools and healthcare. Would Act give them a tax break for doing so, and why?

Hide : Better than that, we would actually provide the full amount for everyone. So we think the state shouldn’t have a preference for state schools over private schools. So we think we should fund every child and that means essentially a scholarship for every child. So those who are already sending their child to an independent school would basically receive the money they are saving today, by sending their children there. Parents currently sending their children to a state school would have the option of sending their child to an independent school, without the financial burden that’s there at present.

Campbell : Isn’t that just education vouchers by another name?

Hide : Sure.

Nice to see an MP not try and do an Orwellian spin.

Campbell : Can you tell me exactly how educational vouchers would lift everyone’s boat, and raise educational outcomes nationwide?

Hide : Sure. This is the experience since 1992 in Sweden. Which is hardly a shining bastion of libertarianism. Or freedom. But they adopted Act’s policy in 1992. To show you how effective its been, all the political parties in their Parliament now support it. The only party to oppose it are the former Communists. Why they found was…only a small percentage, and I forget the number of students, took advantage of the opportunity to shift schools, But as soon as schools were in danger of losing their roll, they actually lifted their game and they took parents seriously.

Where new schools most appeared were in the disadvantaged areas – most obviously amongst the new immigrant areas. Which is quite logical. Where people are sort of well off, well heeled and well incomed even within the state school system they get schools that are, you know, good. Where you find poor areas you find it harder to maintain even a decent state school, And where you have minority cultural groups that don’t necessarily reflect their requirements for education….and so, that’s what happened in Sweden.

This hits the nail on the road. When you get stronger incentives to perform, then performance lifts. Anyone who argues that incentives don’t influence behaviour, has little experience outside a textbook.

Campbell : Could you clarify for me – is Sir Roger intimating to you that he’d like to be in an electable position on the party list?

Hide : Yes.

Campbell : So one could expect him to be two or three – not nine or ten?

Hide :Well, I’m thinking and not because I disrespect Roger…but I’m thinking five or six. Because I want people…if they want Roger in Parliament, to vote for the party. And I also want Roger to come back into Parliament and have some influence. And that requires we get more MPs. But that will be a decision for Sir Roger, and for other members in the board, not for the leader to dictate the list.

I have long suspected he would be placed at around No 6, to encourage people to give ACT 5%. Whether they will, is quite another matter.

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