Monday, September 16, 2013

To Charter or Not to Charter

Before the main post, I have a bit of an editors note.  First, and most importantly, hi!  It's been way too long since I've either seen or talked to many of you; hope you all are doing wonderfully.  Secondly, for a variety of reasons, I'm leaning more toward doing some kind of consulting and/or public policy than staying in academia my whole life.  That means I need to work on writing about economics for non-econ Ph.D.s., so the plan is to start writing some articles in a (hopefully) similar style to what would appear in a magazine or on a blog.  Initially it will be on topics that I'm doing research on and I'll then maybe expand a bit to general economic news.  I thought you all might be interested, so figured I'd post them here!  First up: charter schools.


Any issue that involves race, gender, economic inequality, children, and public funding is bound to bring with it some controversy; the debate over charter schools is no exception.  The idea of a charter school is simple.  Along with funding comes a whole host of procedural requirements that public schools have to abide by, restricting the ability of public schools to adapt to their neighborhood.  While still publically financed, charter schools are granted much more operational autonomy in return for more stringent accountability.  Many charters have taken advantage of the autonomy by structuring their administrative organization and teaching practices in very different ways than public schools.  In particular, much attention has been given to the fact that they, on average, employ younger non-unionized teachers, while public schools work exclusively with unions.  But stripping away some aspects of the controversy, the question stands: does the empirical evidence suggest that charter schools work at improving student achievement.

Initially, this question runs headlong into the problem of selection.  An ideal study wants to compare one student who goes to charter school with an otherwise identical student who goes to a public school.  Then, any difference in their academic achievement is solely due to the differences between the schools the two of them attended.  While it is relatively easy to control for observable differences between a student who attends a charter school and one who attends a public school, the very fact that they chose different schools implies differences between the two that researchers cannot control for.  Studies that naively compare charter school students with public school students might reflect a difference in the type of students who attend the two schools, rather than a difference in the ability of the two schools to educate students.

Because charter schools are publically funded, if more students want to attend the charter school than the school has room for, the school must hold a lottery to determine which students can attend the school; they must choose this way instead of “hand picking” which students can attend, the way a private school like Colby does.  In addition to drama, as documented in Waiting for Superman, these lotteries provide the randomization needed to consistently estimate the effects of attending a charter school.  In particular, it allows researchers to compare two students who not only are observably identical, but also made the same choice to apply to a charter school (or multiple charter schools).

These lottery studies all point to a similar conclusion: students who win a lottery to attend a charter school do better than identical students who lost that lottery.  This is true for just about every observational type of student, regardless of his or her gender, race, prior test scores, or family income. (See, for example, Hoxby et. al., 2009)  In addition, this is true for a variety of ways to measure “do better,” whether it is high school test scores, SAT scores, AP scores, or enrollment at four-year colleges. (See Angrist et. al, 2013) The one caveat to this result is that it holds only for urban charter schools; the results for rural or suburban charter schools are much more mixed.

After reading these studies, the policy implications seem clear: remove, at least in urban areas, some of the many existing barriers that currently make it difficult to found new charters.  But while the research suggests that oversubscribed charter schools work well, the policy implications require more thought than it at first might seem.  First, these studies only estimate the effect of charter schools that hold lotteries.  Assuming that more children apply to the best charter schools, these studies are implicitly looking at the effect of the best charter schools, not of every charter school.  Non-experimental studies, which compare students who are demographically identical, but who differ in their school choice, can estimate the effect of all charter schools.  But they must assume that the selection issue, described in the second paragraph, does not matter.  There is some evidence that this is true in among the schools that are oversubscribed, but I think it is safe to say that this issue is not well understood.  (As an aside, this is a plus for me personally, because it means I can study it.)

The main issue, however, is that even though it is now known that current charter schools are (on average) more successful than public schools, no one has a great sense of why.  This makes it tough to know whether or not the positive effect of charter schools will extend to the next set of charters.  Suppose, for example, that motivated students apply to charter schools and that being around motivated students increase academic outcomes.  In that case, students who attend charter schools will do better academically than identical ones who do not, but increasing charter schools is not necessarily a good policy.  This is both because the next set of charter schools will not as successful and because the presence of charter schools hurt public school students by lowering the motivation of their peers.  On the other hand, if charter schools lead to better results because they often have a longer school year and more flexibility in hiring teachers, increasing the number of charters is advisable. 

In fairness to charter schools, the available evidence suggests that the being surrounded by motivated peers is not the reason why charter students do better than public school students and that getting around restrictions imposed by teachers unions is one of the main advantages of charter schools, but the point still stands.  Without knowing why charter schools work, it is impossible to know what the effect would be of increasing the number of charters.  Knowing why they work is the next step, one that hopefully I’ll be able to help with.