Educational Vouchers and Cream Skimming
Epple and Romano (1998) show equilibrium provision of education by public and private schools has the latter skim off the wealthiest and most-able students, and flat-rate vouchers lead to further cream skimming. Here we study voucher design that would inject private-school competition and increase technical efficiencies without cream skimming. Conditioning vouchers on student ability without restriction on participating schools' policies fails to effect significantly cream skimming. However, by adding conditions like tuition constraints such as vouchers can reap the benefits of school competition without increased stratification. This can be accomplished while allowing voluntary participation in the voucher system and without tax increases.
|Date of creation:||Nov 2002|
|Date of revision:|
|Publication status:||published as Dennis Epple & Richard Romano, 2008. "Educational Vouchers And Cream Skimming," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 49(4), pages 1395-1435, November.|
|Note:||CH PE ED|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
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- Dennis Epple & Elizabeth Newlon & Richard Romano, 2000.
"Ability Tracking, School Competition, and the Distribution of Educational Benefits,"
NBER Working Papers
7854, National Bureau of Economic Research, Inc.
- Epple, Dennis & Newlon, Elizabeth & Romano, Richard, 2002. "Ability tracking, school competition, and the distribution of educational benefits," Journal of Public Economics, Elsevier, vol. 83(1), pages 1-48, January.
- Z. Chen & Edwin G. West, 1998.
"Selective Versus Universal Vouchers: Modelling Median Voter Preferences in Education,"
Carleton Economic Papers
98-02, Carleton University, Department of Economics, revised Dec 2000.
- Edwin G. West & Zhiqi Chen, 2000. "Selective versus Universal Vouchers: Modelling Median Voter Preferences in Education," American Economic Review, American Economic Association, vol. 90(5), pages 1520-1534, December.
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- Eden, B., 1992. "How to Subsidize Education and Achieve Voluntary Integration: An Analysis of Voucher Systems," Working Papers 92-22, University of Iowa, Department of Economics.
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