Gruber and Dynarski report in a recent NBER Working Paper:
The effect of vouchers on sorting between private and public schools depends upon the price elasticity of demand for private schooling.
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We exploit a unique and previously undocumented source of variation in private school tuition to estimate this key parameter. A majority of Catholic elementary schools offer discounts to families that enroll more than one child in the school in a given year.
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We find that a standard deviation decrease in tuition prices increases the probability that a family will send its children to private school by one half percentage point, which translates into an elasticity of Catholic school attendance with respect to tuition costs of -0.19. Our subgroup results suggest that a voucher program would disproportionately induce into private schools those who, along observable dimensions, are unlike those who currently attend private school.
I’ll blog another time about private v. public schooling. What is interesting to me is that they find the demand to be so highly inelastic at Catholic schools. Either people choose them or not, with less regard for the price. I wonder how that behavior would change if the several thousand dollar per year fixed cost of attendance were eliminated? What is more interesting is why anyone cares who takes advantage of voucher programs – or even if this result is surprising. So what if new Catholic school attendees are different than the existing enrollees? Or, should it be surprising that the new enrollees are different than those that now choose to forego “free” public schools for either religious or political reasons?
But this issue is yet another reason that I am not much of a practicing Catholic anymore. How come the Catholic community is not the most vehement opponent of publicly run and funded schools in America? I bet if you polled the Catholics (whom I suspect are politically more liberal than non-Catholics – can we see this in GSS data?), a vast majority would support the idea of public schooling. Aside from whatever theological and institutional issues I have with being a Catholic, unless that position changed dramatically, I will never voluntarily walk into a church to worship again, even if every other thing I was concerned with changed.
Mike, I was lucky to live in a town with a private school for grades 9-12, and had a family that paid for it, despite my family’s having to pay much more in real estate taxes than the cost of tuition, because we were farmers. God bless my parents and my uncle.
My life was forever changed, beginning with the first Latin class and ending after learning from many gifted teachers.
After college I taught in private school for a few years, giving whatever I had in me to transfer what I thought was the best I had been taught. As a teacher, meeting parents, I gained a further appreciation of my responsibility to teach their children, which was not to make them feel good, but to kick them in their intellectual backside. We also had coaching duties. All of this gave me a deep admiration for private education.
It turns out my daughter went to public school, got the good teachers (my wife scoped them out), and did not express any desire to go to my school, which had changed from the place I had been. After college she’s able to think for herself. I’m not about to criticize her high school education. (OK– there were a few jerks who thought punctuation was an art, but my daughter got over that.)
But our public schools today in our area cost upwards of $9000 per student!
Suppose you bought a house for $180,000 ($25,000 per year mortgage, plus another $2000 for utilities) and hired an Oxford tutor for $100,000 per year (that includes payroll taxes and fringe benefits), that’s $127,000. (Let the Oxford tutor live in the house free.) Round that up to $140,000 for field trips to Rochester and Washington, plus the real estate taxes to pay for the kids in the public schools. $140,000 pays for 20 kids at $7000 per kid. Give the Oxford tutor 40 kids, and you are at $3500 per kid. Assign one kid to do the books for the first month, then another, and pretty soon they would all know how to add and subtract.
I know all this ignores the prevailing wage, feeding the Oxford tutor and his signifigant other, and whether you’d have to buy the house for ($800,000, or maybe even a million). Maybe the tutor would come from Kutztown State and cost $120,000 after fringe and payroll taxes and not be able to spell well enough to score 50 in Scrabble.
That’s the problem, isn’t it?