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Public education, communities and vouchers

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  • Luengo-Prado, Maria Jose
  • Volij, Oscar

Abstract

This paper examines the effects of school vouchers on the equilibrium of a simple two-community model with local provision of education. Individuals differ only in income and one community imposes a fixed cost on its residents. We show that the introduction of a simple voucher system can result in a Pareto improvement as an equilibrium phenomenon. This improvement brings higher education quality to both communities.
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Suggested Citation

  • Luengo-Prado, Maria Jose & Volij, Oscar, 2003. "Public education, communities and vouchers," The Quarterly Review of Economics and Finance, Elsevier, vol. 43(1), pages 51-73.
  • Handle: RePEc:eee:quaeco:v:43:y:2003:i:1:p:51-73
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    References listed on IDEAS

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    1. D. N. Figlio & J. A. Stone, "undated". "School Choice and Student Performance: Are Private Schools Really Better?," Institute for Research on Poverty Discussion Papers 1141-97, University of Wisconsin Institute for Research on Poverty.
    2. Manski, Charles F., 1992. "Educational choice (vouchers) and social mobility," Economics of Education Review, Elsevier, vol. 11(4), pages 351-369, December.
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    5. Raquel Fernandez & Richard Rogerson, 1996. "Income Distribution, Communities, and the Quality of Public Education," The Quarterly Journal of Economics, Oxford University Press, vol. 111(1), pages 135-164.
    6. Henderson, Vernon & Mieszkowski, Peter & Sauvageau, Yvon, 1978. "Peer group effects and educational production functions," Journal of Public Economics, Elsevier, vol. 10(1), pages 97-106, August.
    7. Epple, Dennis & Romano, Richard E., 1996. "Ends against the middle: Determining public service provision when there are private alternatives," Journal of Public Economics, Elsevier, vol. 62(3), pages 297-325, November.
    8. Stiglitz, J. E., 1974. "The demand for education in public and private school systems," Journal of Public Economics, Elsevier, vol. 3(4), pages 349-385, November.
    9. Gerhard Glomm & B. Ravikumar, 1998. "Opting out of publicly provided services: A majority voting result," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 15(2), pages 187-199.
    10. Fernandez, Raquel & Rogerson, Richard, 1998. "Public Education and Income Distribution: A Dynamic Quantitative Evaluation of Education-Finance Reform," American Economic Review, American Economic Association, vol. 88(4), pages 813-833, September.
    11. Rangazas, Peter, 1995. "Vouchers in a community choice model with zoning," The Quarterly Review of Economics and Finance, Elsevier, vol. 35(1), pages 15-39.
    12. Thomas J. Nechyba, 1996. "Public School Finance in a General Equilibrium Tiebout World: Equalization Programs, Peer Effects and Private School Vouchers," NBER Working Papers 5642, National Bureau of Economic Research, Inc.
    13. Hoyt, William H. & Lee, Kangoh, 1998. "Educational vouchers, welfare effects, and voting," Journal of Public Economics, Elsevier, vol. 69(2), pages 211-228, June.
    14. Caroline Minter Hoxby, 1994. "Do Private Schools Provide Competition for Public Schools?," NBER Working Papers 4978, National Bureau of Economic Research, Inc.
    15. Fernandez, Raquel & Rogerson, Richard, 1997. "Keeping People Out: Income Distribution, Zoning, and the Quality of Public Education," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(1), pages 23-42, February.
    16. repec:eme:rlepps:v:18:y:1999:i:1999:p:115-140 is not listed on IDEAS
    17. Epple, Dennis & Romano, Richard E, 1998. "Competition between Private and Public Schools, Vouchers, and Peer-Group Effects," American Economic Review, American Economic Association, vol. 88(1), pages 33-62, March.
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    Cited by:

    1. Martinez-Mora, Francisco, 2006. "The existence of non-elite private schools," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1505-1518, September.
    2. Francisco Martínez Mora, 2004. "Opting-out and income mixing in urban economies:the role of neighborhood effects," Economic Working Papers at Centro de Estudios Andaluces E2004/67, Centro de Estudios Andaluces.
    3. Francisco Martinez Mora, "undated". "Income Stratification Across Public and Private Education: The Multi-community Case," Discussion Papers 03/01, Department of Economics, University of York.

    More about this item

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods

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