Monday, December 23, 2013

Market competition and student learning outcomes

The latest PISA report is out. The big stories are the expected consolidation at the top by the East Asian countries and the surprising decline of the poster child of school education, Finland.

An equally interesting story is the even bigger decline of another traditional high performer, Sweden. In the 2006-12 period, it has fallen precipitously from 21st to 38th position in Math and 10th to 37th in Reading, both easily being the worst performances in the respective categories. What explains this trend?

Interestingly, over the past two decades, Sweden has undertaken certain fundamental reforms in its education system, most notably the increased involvement of private sector. Private, for-profit schools, Friskolas, were allowed, and parents were given tax-funded vouchers to pay for a school of their choice. The result is that almost a quarter of the country's secondary school students attend voucher-funded private schools, almost twice the global average. A recent report wrote,
Sweden replaced one of the world's most tightly regulated school systems with one of the most deregulated.. . The private schools brought in many practices once found exclusively in the corporate world, such as performance-based bonuses for staff and advertising in Stockholm's subway system, while competition has put teachers under pressure to award higher grades and market their schools.  
Many of the outcomes were completely predictable. Private participation and deregulation was accompanied by the inevitable problems of deteriorating quality. The Schools Inspectorate has found high-profile cases of private operators focusing merely on getting students to pass-grade instead of improving quality, stocking up on temporary teachers without required qualifications, and schools without adequate facilities. And the inexorable logic of choice,
As the best students flock to certain schools, standards suffer at the schools they leave behind. 
For the researchers and education "experts", who spend millions of dollars with sanitized micro-experiments of all kinds to assess the effectiveness of school-vouchers and private participation in education, the results from Sweden should be of much greater interest. In particular, Sweden's experience has much to enlighten about the debate about school vouchers. Furthermore, it is also a very good test case for the scaled version of the school voucher system, private participation, and deregulation. Since it has been on for nearly two decades, its general equilibrium effects are a more reliable barometer of such complex reforms.

Correlation is not causation. But neither is experimental research the gold-standard for determining causation. My only brief here is that we need to tread with extreme caution with such profound school reforms. Any aggressive push for private participation in schooling, especially in countries with weak state capability, is most certain to fall far short of expectations.

The PISA test assesses math, reading, and science competencies of more than half a million 15-16 year-olds in 65 countries/regions representing 28 million children of that age group. It is widely acknowledged as a touchstone for schooling excellence, including conceptual understanding, in all major countries of the world, except India!

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