The Charter Paradox

The Unintended Consequences of School Choice

By Diane Ravitch

Harvard Magazine published an interesting article with fresh thinking about school choice. No blue-sky claims, like the Friedman Foundation. No fear-mongering. Some thoughtful comments about unintended consequences.

“A recent paper models a choice system that assigns schools according to families’ preferences, allotting seats at more sought-after schools by lottery. Parents would compete for access to the best schools, so that each school would not only reflect the socioeconomic mix of the community but also become perfectly equal—and average—in quality, Avery explains. But such a result, the model shows, would encourage wealthy families to abandon the system for better-than-average schools that are either private or in another district—a “flight” phenomenon widely documented already.

“Pathak and Avery also show a second mechanism—the effect of school quality on home prices—that forces flight not by wealthy families, but by the poor. “When you introduce school choice, school quality compresses…so the house-price distribution compresses as well,” Pathak says, meaning that low-income families are priced out of their own neighborhoods as the schools in their community improve. Home values reflect differences in school quality so faithfully that prices spike and fall along district boundaries. “You see this at the border between [the Boston public school system] and Brookline…if the houses are almost identical, they’re still very different prices because people perceive the schools to be much higher quality in Brookline,” he explains.

“In reality, though, researchers know that school choice hasn’t worked this way. Because of variation in families’ school preferences, imperfect information, test-based admissions systems that favor advantaged students, and other frictions, cities that have embraced choice systems are very far from producing perfectly equal schools. In some cases, school lotteries do help underserved students gain access to top schools. What, then, of the model? “What happens in practice is, we think, some combination of things,” Avery suggests. Real-life choice systems resemble something between neighborhood schools and a perfect-competition choice system. If schools remain sufficiently unequal, then people can afford to continue to live where they’re living. Says Avery, “It’s sort of a paradox.”

The most elusive yet most important goal is to increase the supply of good schools in every neighborhood.