Rethinking the Welfare State: The prospects for ... - e-Library

Rethinking the selfare state 164
schools will have incentives simply to pass all of their students, regardless of their actual
academic achievement. While more sophisticated mandatory performance disclosure
requirements can obviously be devised, their complexity is likely to intensify the
information-processing burdens faced by the broad spectrum of parents. Compounding
this burden on parents is the fact that the actual attributes of education services provided
can never be fully known. Because education is to an important extent a “credence” good,
rather than an “experience” or “search” good, 168 parents must, to some extent at least, rely
on suppliers’ claims about the educational services provided—claims that may perhaps
be more credible with governmental or private, non-profit provision of educational
services. 169
Michael Fullan has demonstrated that external monitoring (for example, curriculumbased
external exit examinations) tends to increase the overall quality of education
received by children. 170 One explanation for the mechanism through which this works is
that in the absence of an external monitoring arrangement for educational attainment,
students and parents have an incentive to select a school that will dispense the highest
grades for a given objective level of performance because doing so increases one’s
chances of acquiring a valuable labour-market signal. 171 Government accreditation,
standardized tests, and mandatory disclosure of certain key data about school
administration and performance provide some means of disciplining suppliers and
providing this external monitoring. However, depending on their design, they will vary
greatly in efficacy. For instance the Milwaukee voucher experiment was too lax in this
regard. The Milwaukee voucher scheme articulated four criteria, of which schools were
required to meet at least one:
1 70 percent of students must advance one grade per year;
2 there must be a 90 percent attendance rate;
3 at least 80 percent of students must make significant academic progress;
4 at least 70 percent of parents must be involved in the life of the school.
If schools were unable to meet any of these criteria, they were given the opportunity to
create an alternative criterion of evaluation. Unsurprisingly, no schools ever failed to
meet at least one of these criteria 172 —and even if they had, it would have been relatively
easy to devise something else that would have sufficed. The consequences were dramatic.
One school—the Juanita Virgil Academy—closed within a year of opening. Two other
schools—the Milwaukee Preparatory School and Exito—failed while their founders were
pursued for fraud and other criminal charges. The former principal of Exito is now
serving a prison term on fraud and drug charges. 173 Clearly, a meaningful role for
government in maintaining the integrity of a primary and secondary education voucher
system is crucial to its success.
Political economy
Primary and secondary education in Canada, the US, and many other countries is a
context in which the existing alternative to a voucher-based program is government
provision of educational services. Accordingly, it is characterized by entrenched interests
that are inclined to resist any significant change in the way that educational services are
delivered. First, and most importantly, public school teachers at the primary and