The Evidence on Vouchers: How Does the Cleveland Scholarship Program Fit In?

1. The Evidence on Vouchers: How Does the Cleveland Scholarship Program Fit In? Clive Belfield City University of New York National Center for the Study of Privatization in Education, Teachers College, Columbia University

2. New Research on Vouchers • Economic principles of choice and efficiency • Evidence from K-12 programs (Milwaukee, Florida, Washington DC) • Data analyses using exogenous variation and other school choice reforms • Expansion of voucher programs (e.g., in pre-school, higher education)

3. Evidence on Vouchers • School choice/demand: • Religious preferences dominate • Although targeted at low-income families, educated parents apply for vouchers • Use rate ~25% below offer rate • Use rate lower for minority students • Racial segregation by choice • Sub-additive: ~25% in private school already; ~5% go to private school without voucher

4. Evidence on Vouchers • School technology/supply: • Various religions participate • Development of all-voucher schools • Only religious, for-profit, and adverse selection schools; others charter • Unknown: Cost/revenue functions and superior (?) technologies of private schools • Broader implications: • Home-owners do not like vouchers • High ability students gain most: voucher; cross-subsidy; and ability-tracking in public schools

5. Evidence on Vouchers • Effectiveness: Small positive impact on achievement: • In Milwaukee, for math (0.1sd) not reading • In Florida, mainly a function of student characteristics • In experiments, for African Americans • Charter school literature and lotteries show similarly weak results • Other outcomes may be more important

6. Key Research Issues Voucher status: • User • Non-user (conditional on offer) • Rejected applicant • Public school population Biases when comparing across voucher status: • Application; eligibility; usage; school switch; resources Effects of interest: • Across each status; treatment; intention to treat; dose-response; by race

7. Cleveland Scholarship Program • 5,734 students participate in K-12 grades • Low-income families given priority • Voucher worth $2,750-$3,000 (<40% of public school ave. cost) Data on 3,000 students from K in 1997 Evaluation by Indiana University

8. Advantages of research on CSP The silent program: • Recent data in context of growing school choice • Religious schools participate • Students in many different schools • High proportion of African American students • Longitudinal data across voucher status • Relatively ungenerous voucher

9. Same findings for CSP • Religious preferences: 40 of 42 chosen schools • Voucher schools: 50% of Catholic school enrollments • Non-profit voucher schools become charter schools • Use rate below offer rate: non-users 40% of users • Use rate lower for minority and low-income students • Very high rates of sub-additivity (applications from private sector)

10. Frequencies for Second Grade

11. Achievement Effect Sizes vs. Public School Comparison Group: 2nd Grade Notes: OLS. SE in parentheses. Equation includes: subject-specific first grade scores; constant; black; Hispanic; female; free lunch; unsubsidized lunch; class size; and teacher experience measured in years. * significant at 10%; ** significant at 5%; †significant at 1%.

12. Achievement Effect Sizes vs. Public School Comparison Group: 4th Grade Notes: OLS. SE in parentheses. Equation includes: subject-specific first grade scores; constant; black; Hispanic; female; free lunch; unsubsidized lunch; class size; and teacher experience measured in years. * significant at 10%; ** significant at 5%; †significant at 1%.

13. Additional Results for Users 1. Unadjusted for prior scores: Math penalty -0.12sd [2nd/4th grade] Language gain +0.12sd [4th grade] 2. Winners (users and non-users): Math penalty -0.08sd [2nd grade] Math penalty -0.06sd [4th grade] Language gain vs public +0.12sd [4th grade] 3. Treatment group (users vs. rejected): Reading penalty -0.14sd [2nd grade] Math penalty -0.11sd [2nd grade] Language gain +0.11sd [4th grade]

14. Additional Results for Users 4. Dose-response (users split by years of use): Weak evidence: • for 2nd grade, all significant effects are for 3-year users • for 4th grade, significant effects across any durations 5. African-American sub-sample: Same results, except: • Reading penalty -0.14sd [2nd grade] • Math penalty disappears [2nd grade] • Reading gain +0.14sd [4th grade]

15. Economic Analysis • Cleveland Program outcomes not much worse than existing public schools • Voucher value $2,400 + x1% for transportation + x2% for assessment + x3%for private school support/exemption from regulations • Sub-additivity = 33%, i.e. 3 vouchers for every marginal user • CMSD average cost = $8800 in 2001 (incl. special education; incl. less motivated families) • Even with a low face-value voucher efficiency could be equal

16. Conclusions • Cleveland Program similar in effect to other voucher programs • Can be justified as promoting freedom of choice State-wide vouchers: • Most of the equity arguments apply only to small-scale programs • With charter school option, religious schools must be supply-responsive