The economics of school choice

Contributions to the 'school choice' debate have exploded in the last ten years. Most of the recent contributions have come from the US on the back of the American revolution in market-led school choice experiments. However, the central idea has a long pedigree and understanding recent contributions like the new book edited by Caroline Hoxby requires some background. The first thing to understand is that in this book the phrase 'school choice' is used synonymously with the idea of a voucher system. Unlike in other countries, the context of the,school choice' debate in the US refers to the extent to which market principles can and should be used in education and the details of the type of voucher (or charter school) scheme and its possible effects. This article explains where the school choice idea came from and briefly summarises the state of the debate. Of necessity, we review what is happening in the US in school choice reform, before examining what is new in the Hoxby volume. We then reflect on what is missing so far in this debate - exploring the idea that educational outputs are not unidimensional and that this can induce incentive problems. We also suggest that the key concept of accountability has been given insufficient attention in this debate.