Study: Fla. Tax Credit Program Improved Public School Scores

By Sean Cavanagh — December 07, 2010 2 min read
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The headline reads, “Does Competition Improve Public Schools?” And the answer, according to an analysis of one state’s prominent tax credit scholarship program, is “yes.”

A study, summarized in an article in the latest issue of the journal Education Next, finds that a Florida program that supports private school scholarships for students through corporate-tax credits had a positive effect on the test scores of students in nearby public schools that were forced to compete for those students.

As the authors of the article, David Figlio and Cassandra M.D. Hart, point out, much of the attention paid today to devoting public resources to private school education focuses on vouchers. Yet the authors say that tax-credit programs, nationwide, are sending a greater number of impoverished students to private schools than vouchers do. They focus on the impact of one such effort, the Florida Tax Credit Scholarship Program, which was signed into law in 2001 by the state’s then-governor, Republican Jeb Bush.

Backers of school choice have long argued that it drives improvements in public schools, by forcing them to do better or risk losing students (and per-pupil funding) to private school rivals.

Figlio and Hart find evidence of that pattern in their study, in which they isolate the effects of competition by comparing various Florida public schools’ performance before and after needy students began using the scholarships, in 2002-2003.

Their results show modest, but clear gains in reading and math test scores for students in public schools that faced private school competition through the Florida program. The closer to the nearest private school, the greater the public school gains. And for public schools having a larger number of private schools nearby, the effect was even greater, the study showed.

Additionally, the improvement in public school scores began before any Florida students had actually used a private school scholarship through the program, the authors say, suggesting that the “threat of competition alone” appeared to have spurred academic gains. The effect of competition on public school test scores was more than twice as large for elementary and middle schools than for high schools. That could be because the scholarships cover a larger share of tuition in primary than the secondary private schools—and so public schools serving younger students were especially motivated to outperform private schools serving the same age group, the authors speculate.

Policymakers in several states are vowing to bring forward school choice proposals in the coming legislative sessions, and perhaps the study will support them in those efforts.

But Figlio urged caution in applying the results of the the study too broadly. More than 90 percent of Florida’s students live in the state’s 20 most populous metro areas. In other states with more rural schools and fewer private school options, the competitive pressure may not be as great.

Figlio is a professor of education, social policy and economics at Northwestern University, and Hart is a doctoral student at the university. The study was released earlier this year as a working paper of the National Bureau of Economic Research, where Figlio is a research associate.

For a more detailed look at the results, see my colleague Debra Viadero’s breakdown of the working paper from earlier this year. What do you make of the study’s findings? Does it shape your thinking on the use of public resources for private schools, in Florida or in other states?

A version of this news article first appeared in the State EdWatch blog.