IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwppe/0512004.html
   My bibliography  Save this paper

Do Vouchers Lead to Sorting under Random Private School Selection? Evidence from the Milwaukee Voucher Program

Author

Listed:
  • Rajashri Chakrabarti

    (Harvard University)

Abstract

This paper analyzes the impact of voucher design on student sorting, and more specifically investigates whether there are feasible ways of designing vouchers that can reduce or eliminate student sorting. It studies these questions in the context of the first five years of the Milwaukee voucher program. Much of the existing literature investigates the question of sorting where private schools can screen students. However, the publicly funded U.S. voucher programs require private schools to accept all students unless oversubscribed and to pick students randomly if oversubscribed. This paper focuses on two crucial features of the Milwaukee voucher program - random private school selection and the absence of topping up of vouchers. In the context of a theoretical model, it argues that random private school selection alone cannot prevent student sorting. However, random private school selection coupled with the absence of topping up can preclude sorting by income, although there is still sorting by ability. Sorting by ability is not caused here by private school selection, but rather by parental self selection. Using a logit model and student level data from the Milwaukee voucher program for 1990-94, it then establishes that random selection has indeed taken place so that it provides an appropriate setting to test the corresponding theoretical predictions in the data. Next, using several alternative logit specifications, it demonstrates that these predictions are validated empirically. These findings have important policy implications.

Suggested Citation

  • Rajashri Chakrabarti, 2005. "Do Vouchers Lead to Sorting under Random Private School Selection? Evidence from the Milwaukee Voucher Program," Public Economics 0512004, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwppe:0512004
    Note: Type of Document - pdf; pages: 35
    as

    Download full text from publisher

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/pe/papers/0512/0512004.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Levin, Henry M., 1992. "Market approaches to education: Vouchers and school choice," Economics of Education Review, Elsevier, vol. 11(4), pages 279-285, December.
    2. Levin, Henry M., 1991. "The economics of educational choice," Economics of Education Review, Elsevier, vol. 10(2), pages 137-158, June.
    3. Chakrabarti, Rajashri, 2008. "Can increasing private school participation and monetary loss in a voucher program affect public school performance? Evidence from Milwaukee," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1371-1393, June.
    4. 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.
    5. Caroline Minter Hoxby, 2003. "School Choice and School Productivity. Could School Choice Be a Tide that Lifts All Boats?," NBER Chapters,in: The Economics of School Choice, pages 287-342 National Bureau of Economic Research, Inc.
    6. Henry M. Levin, 1998. "Educational vouchers: Effectiveness, choice, and costs," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 17(3), pages 373-392.
    7. David E. Campbell & Martin R. West & Paul E. Peterson, 2005. "Participation in a national, means-tested school voucher program," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 24(3), pages 523-541.
    8. Maria Marta Ferreyra, 2007. "Estimating the Effects of Private School Vouchers in Multidistrict Economies," American Economic Review, American Economic Association, vol. 97(3), pages 789-817, June.
    9. Figlio, David & Hart, Cassandra M.D. & Metzger, Molly, 2010. "Who uses a means-tested scholarship, and what do they choose?," Economics of Education Review, Elsevier, vol. 29(2), pages 301-317, April.
    10. 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.
    11. Epple, Dennis & Figlio, David & Romano, Richard, 2004. "Competition between private and public schools: testing stratification and pricing predictions," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1215-1245, July.
    12. Holger Sieg & Dennis Epple & Richard Romano, 2003. "Peer effects, financial aid and selection of students into colleges and universities: an empirical analysis," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 18(5), pages 501-525.
    13. Dalton Conley & Rebecca Glauber, 2006. "Parental Educational Investment and Children’s Academic Risk: Estimates of the Impact of Sibship Size and Birth Order from Exogenous Variation in Fertility," Journal of Human Resources, University of Wisconsin Press, vol. 41(4).
    14. Eric J. Brunner & Jennifer Imazeki & Stephen L. Ross, 2010. "Universal Vouchers and Racial and Ethnic Segregation," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 912-927, November.
    15. Dennis Epple & Richard Romano & Holger Sieg, 2006. "Admission, Tuition, and Financial Aid Policies in the Market for Higher Education," Econometrica, Econometric Society, vol. 74(4), pages 885-928, July.
    16. William G. Howell, 2004. "Dynamic selection effects in means-tested, urban school voucher programs," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 23(2), pages 225-250.
    17. Hsieh, Chang-Tai & Urquiola, Miguel, 2006. "The effects of generalized school choice on achievement and stratification: Evidence from Chile's voucher program," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1477-1503, September.
    18. Chang-Tai Hsieh & Miguel Urquiola, 2003. "When Schools Compete, How Do They Compete? An Assessment of Chile's Nationwide School Voucher Program," NBER Working Papers 10008, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chakrabarti Rajashri, 2013. "Impact of Voucher Design on Public School Performance: Evidence from Florida and Milwaukee Voucher Programs," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(1), pages 349-394, July.
    2. Behrang Kamali-Shahdadi, 2016. "Sorting and Peer Effects," PIER Working Paper Archive 16-002, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 08 Feb 2016.

    More about this item

    Keywords

    Vouchers; Sorting; Cream Skimming; Private Schools;

    JEL classification:

    • H0 - Public Economics - - General
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwppe:0512004. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA). General contact details of provider: https://econwpa.ub.uni-muenchen.de .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.