Bradley, S. & Taylor, J., (2004)

‘The Economics of Secondary Schools’

in Johnes, G. & Johnes, J., (eds.), International Handbook on the Economics of Education, Edward Elgar, Cheltenham, pp 368-414

• Reviews the literature on the economics of secondary schooling, and assesses the impact of the ‘quasi-market’ in secondary education on outcomes and segregation.
• The authors note the blurred and inconclusive nature of the evidence regarding education production functions. The impact of class sizes, per-pupil spending and personal characteristics on educational attainment are not well understood.
• For both the US and the UK, the authors note evidence that greater competition between schools and between school districts leads to better educational outcomes, as measured by exam results.
• In the empirical section of this paper, the authors estimate the efficiency and equity effects of the quasi-market on secondary education, using a first-difference model.
  

Key results:

• Using published school performance data, the authors find ‘firm support’ for the view that competition between schools has led to an improvement in exam performance.
• A 1-point improvement in the exam performance of other schools in the same district is associated with an improvement of 0.41 point for schools in metropolitan areas.
• The authors also find some evidence that the quasi-market has contributed to the increase in the social segregation of pupils between schools – but not to an (economically) significant extent.
• The authors conclude that the introduction of market forces into the secondary education sector has had a beneficial impact on educational performance, without a significant cost in terms of increased polarisation of pupils between schools.