Chile’s School Choice Success Story

0-pz-chile-school-choiceAmerica could learn a lot from Chile’s education success story.  Former Chilean ambassador Dario Paya wrote a brilliant Weekly Standard piece outlining their amazing turnaround after dramatically expanding school choice in 1980.  Before vouchers Chile was near the bottom of educational achievement in Latin American, now they are at the top.  And the reason has not been more spending!

How did very poor and rural children fair under the new system?

Chile recognized that some kids—primarily the very poor and rural—were being “left behind.” But the way to fix that problem was not to get rid of vouchers, but to expand the system. That expansion, now the better part of a decade old, has had amazing results.

What was the key to providing more options for poor and rural children?

With massive bipartisan support, a “preferential” school voucher was created—that is, one worth more, sometimes almost twice the value of regular vouchers—to provide more options for very poor and rural families. The results have been significant.

What were the results on the achievement gap?

Economist Christopher Neilson noted in a 2013 working paper that “this reform raised the test scores of poor children significantly and closed the gap between these students and the rest of the population by one third.” Neilson said the “policy changed the nature of competition among schools” and that “the observed policy effect is due mostly to the increase in the quality of schools in poor neighborhoods and not to a resorting of students to better schools or the entry of new higher-quality schools. The introduction of targeted vouchers is shown to have effectively raised competition in poor neighborhoods, pushing schools to improve their academic quality.”

The performance gap between the country as a whole and the poorest 40 percent was cut by one-third in just five years.

How did the system change and improve?

Back when the base voucher wasn’t big enough to liberate the rural poor from the monopolistic power of public schools, those schools could still spend their budget on things other than “quality” and the parents were trapped. Once the bigger preferential vouchers were introduced, those parents’ options dramatically expanded and public schools reacted predictably, increasing their quality to keep them from leaving. Two thirds of the improvement in the education of Chile’s poor can be attributed to voucher-encouraged improvements in the quality of public schools in poor neighborhoods. A third of those improved outcomes can be credited to parents sending their kids to private schools.

This is just what Mitch Pearlstein and other school choice advocates have predicted:  competition from real school choice will lead to better public schools and kids who need a more nurturing environment often provided by private and religious schools would reach their potential there.

Are vouchers a cure-all?  What else matters?

There are many other lessons to be learned from the Chilean experience. One is that vouchers are not a cure-all. The virtuous effects of vouchers, choice, and competition in Chile have been hampered and limited over the years by increased government control over all aspects of education. With very limited autonomy, with schools singing mostly government-dictated content in government-regulated style, there’s little space for real competition, innovation, and progress. Do not, for a moment, believe that vouchers are enough to rescue education from public strangulation.

But socioeconomic inequalities must have increased, right?

Using the Gini index of inequality, Claudio Sapelli, professor of economics at the Pontificia Universidad Católica de Chile, has shown that the level of inequality among older generations of Chileans is comparable to that of Mozambique. But among Chileans born in 1980 (the year the voucher system was introduced), the Gini index is comparable to that of France—and more equal than the United States.

Chile’s experience is so inspiring and encouraging.  Choice at the college level has given the U.S. the best higher education system in the world, why is it so difficult to use choice and competition to improve education at the elementary and secondary levels?

Peter Zeller is Director of Operations at Center of the American Experiment.