Fighting for Equity in Education

OECD Study on Choice and Equity Informs Post-Gonski Debate

Monday February 20, 2012

The central issue in the Gonski review of school funding has been whether the focus of government funding policies should switch from supporting choice to improving equity in education. A new OECD study comes down firmly on the side of improving equity. Its findings should inform debate over the Gonksi report.

The study shows emphatically that school choice has lead to greater social segregation and inequity in education. It says that increased school choice in OECD countries has not led to any improvement in student achievement. School choice schemes have benefitted advantaged parents and students but harmed disadvantaged and low income families.

The abstract of the study is particularly blunt:

In the last 25 years, more than two-thirds of OECD countries have increased school choice opportunities for parents. The empirical evidence reviewed here reveals that providing full parental school choice results in further student segregation between schools, by ability, socio-economic and ethnic background, and in greater inequities across education systems.

The study concedes that school choice is here to stay, but says that countries should explore choice schemes that balance parents’ freedom to choose with equity considerations. It advocates tighter regulation of private school fees and enrolment criteria, controlled choice programs to reduce social segregation between schools and weighted school funding to better support disadvantaged students and schools.

Australia has the highest degree of school choice of any OECD country. Ninety per cent of students are in secondary schools where principals report that they compete with two or more schools and 96% are in schools which compete with at least one other school. The only other OECD countries with over 80% of students in secondary schools which compete with two or more other schools are Belgium and Japan. The average for OECD countries is 60%.

Australia has a large private school sector which is largely funded by government to provide school choice. Few other OECD countries provide public funding for private schools. Private schools in Australia account for just under 40% of secondary school students. Only Netherlands, Belgium Ireland and Chile have a larger private sector. On average, 85% of students are enrolled in public education across OECD countries.

School choice advocates argue that the introduction of market mechanisms in education allows equal access to high quality schooling for all. They say that expanding school choice opportunities would allow all students – including disadvantaged ones and the ones attending low performing schools – to change to better schools.

However, empirical research does not support these claims. The OECD paper provides an in-depth literature review of studies of school choice around the world over the past 20 years. It considers the impact on students who choose to attend a public or private school other than their local public school, the impact on students who stay in their local school and which parents are more likely to exercise choice.

Impact of choice on student achievement
A significant body of research has analysed randomized lotteries in the United States, usually employed in school districts and schools to determine which students are assigned to over-subscribed schools. In comparing student performance between lottery winners and losers, these studies find no significant benefit in terms of achievement in attending a public school other than their local one. Studies of other countries show mixed effects. For example, increased school choice did not have any positive effect on student achievement in Chile, but positive effects were found in the Netherlands.

Charter schools in the US appear not to have increased student achievement. For example, a recent longitudinal study cited in the OECD paper found no substantial gains for students that transferred to charter schools over those from local schools. In some cities and states, charter schools perform significantly worse than public schools.

A recent review of research papers comparing the achievement of students who switch to charter schools with those who stay in the traditional public schools found that the achievement of students in charter schools is no greater than in public schools.

The results from Programme for International Student Assessment (PISA) 2009 suggest within OECD countries, on average, students who attend private schools perform 25 score points higher (over six months learning) in reading than students who attend public schools. However, students who attend private schools are also from more advantaged socio-economic backgrounds, so part of the positive relationship between private schools and performance is due to the socio-economic characteristics of the school and students, rather than to an advantage intrinsic in private schools. After accounting for the socio-economic and demographic characteristics of students and schools, the OECD average is reduced to 3.4 score points and is no longer statistically significant. The conclusion is that there are no differences in overall performance in relation to the extent of private schooling within a country.

One of the arguments for school choice is that it will put competitive pressures on public schools to improve. However, there is little empirical support for this claim. The OECD paper cites a comprehensive review of the effects on public schools of competition from private schools which reported that over half of the estimates from 14 studies reviewed were statistically insignificant. The studies that did find positive effects were too small or/and used a questionable methodology.

The paper notes that cross-country correlations of results from PISA do not show a relationship between the degree of competition and student performance. Among school systems in the OECD countries, the proportion of schools that compete with other schools for student enrolment seems unrelated to the school system’s overall student performance, with or without accounting for socio-economic background.

The paper concludes from its review of empirical studies that:

Overall, only a few studies find a link between increased choice and enhanced student outcomes, and when they do exist, the effects are quite small and not always statistically significant, partly due to methodological difficulties…..The majority of the evidence suggests that different schemes of school choice (open enrolment, charter schools) do not, through the competition they create for local schools, induce them to improve, nor ….[does] it improve the student achievement of those who take advantage of more school choice and opt out of their local school as the evidence reviewed shows. [p. 30]

Parent choice leads to greater social segregation
The study says that the research on parental choice is unanimous: it is more affluent parents who are more likely to exercise school choice. Parents of minority ethnic backgrounds and from low socio-economic background tend not choose even when they are offered several school choice options. The main beneficiaries are children whose parents have the personal resources to take up the opportunity of choice.

All in all, concerns about whether families – particularly less educated ones and minorities, have enough information to make informed decisions, and whether parental preferences will lead parents to select schools based on the ethnic or socio-economic status composition of their students, rather than on academic quality, seem to be justified. [p. 33]

Research shows that parents prefer schools with populations ethnically and socio-economically similar to their own family. Many studies show a flight of well-off parents to schools with higher socio-economic status. As disadvantaged families tend to send their children to their local school, it is more advantaged families making the choice to segregate.

The study cites a number of studies from around the world showing that increased parental choice leads to more segregated schools. It concludes:

To sum up, while choice can be seen as a mechanism that levels the “playing field” and provides the same opportunities for all, the evidence shows that it may not have the intended effects: better-off families and more educated parents are the ones who exercise choice, and that will enjoy access to a wider variety of schooling options. While the students who stay in the public schools might theoretically benefit from the effects of competition…., they might be hurt by the departure of classmates and teachers to the other seemingly higher performing schools, or might suffer from the loss of resources due to reallocation. Therefore, the introduction of school choice mechanisms can lead to segregation across schools and to more disadvantages for those who are worse off. [p. 35]

Choice policies to support equity
The paper says that some evidence shows that choice can be an effective policy to create opportunities and close achievement gaps if they are targeted and supported to serve primarily disadvantaged populations. Such schemes have to be structured in ways that do not concentrate benefits only for those who are already better-off.

It says that top-up fees in government funded schools should be avoided or tightly regulated, enrolment criteria should be the same for all students, parents should be supported in making well-informed choices and low performing schools should receive additional support to improve.

Research shows that school systems that combine school choice and the payment fees by parents are the ones that tend to have more segregation. The report says that “It has been proven that systems that combine school choice and the possibility to ask for extra fees to parents are the ones that tend to have more segregation” [p. 37]. This applies to both government schools and government funded private schools.

The combination of choice and fees enables well-off families to self-segregate. For example, the New Zealand system of open choice has increased the separation of ethnic groups between schools because minority and low income students have been unable to afford the student fees associated with attending a high-ranked school. This has advantaged well-off families and constrained disadvantaged students to the lower performing schools.

In Australia, the combination of government funding and fees levied by private schools has also provoked an increased polarization. The fees mean that parents from higher SES groups are more likely to choose private schools than parents from lower SES background. The paper says that government funding of private schools in Australia has enabled them to “use the extra resources to increase the quality of schooling, and further therefore, increase the achievement gap between public and private schools, and the gap between high SES students and lower SES students” [p. 37].

The paper says that government funding of private schools should be combined with government regulations on the fees to ensure that the funding is translated into lower fees.

It also suggests tighter government regulation of enrolment processes to avoid cream-skimming of students by schools who have discretion over admission criteria and fees.

When schools are allowed to apply selective academic and income criteria, this aggravates school composition segmentation, as oversubscribed schools tend to hand-pick their students, crowding out disadvantaged students and students with low performance. The criteria to enrol in a school should be the same for all students, clear and transparent, based on proximity and presence of siblings and on lottery systems, or on formulas to achieve a heterogeneous mix of students. [p. 38]

It says that if admission policies and student enrolment procedures are homogeneous, fixed and controlled by a central authority, schools have fewer opportunities to select students.

The paper also recommends greater support for parents to make well-informed choices by reducing the cost of obtaining information about the strengths and weaknesses of schools. Governments should provide targeted parent information programs rather than catering to the preferences of active choosers, who tend to be well-off parents.

A key recommendation is that low performing schools should receive additional government support:

....to ensure higher education quality overall, school choice should be complemented with strategies to provide effective support to schools that might be performing at non satisfactory levels or losing students with the choice arrangements. Only through effective support can the problem of stratification of schools be diminished. [p. 40]

The study notes that many countries are making efforts to tackle the problem of segregation due to school choice. Two measures to combine school choice and more equity are controlled choice programmes and progressive voucher schemes.

Controlled choice programmes are student allocation schemes that provide parental choice but also limit social segregation. These schemes integrate students of different background (in terms of parental socio-economic status, ethnical origin, etc). They allow families to choose within their zone, provided that their choice will not upset the ethnic and socio-economic status balance of schools. They ensure that, in the event of oversubscription in some schools, disadvantaged and low performing students will not be forced to enrol in another school.

As an alternative to controlled choice schemes, many countries have established incentives to make disadvantaged and/or students with low performance more attractive to schools. These are called progressive voucher schemes or weighted student funding. The funding follows the students on a per-student basis to the school they attend and this amount depends of the educational needs of the children. As a consequence, disadvantaged students bring more funding to their school, compared to “regular” students.

The study concludes that:

....the theoretical benefits of introducing market mechanisms in education are not easily identified empirically, and it seems that choice schemes do provide enhanced opportunities for some advantaged parents and students who have a strong achievement orientation, but also harm others, often more disadvantaged and low SES families. [p. 43]

It says that school choice should be carefully designed to combine parental freedom with enhanced opportunities for disadvantaged students and equity.

Trevor Cobbold

Musset, Pauline 2012, School Choice and Equity: Current Policies in OECD Countries and a Literature Review, OECD Education Working Papers, No. 66, OECD Publishing, January.

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