In recent decades, many countries have established autonomous schools, which are publicly funded but can operate more independently than government-run schools. Natalie Irmert, Jan Bietenbeck, Linn Mattisson and Felix Weinhardt use data from 15 countries over 16 years to examine the impact of these schools. They find the schools have no overall improvement in educational attainment and increase inequality.
The proliferation of autonomous schools over the past decades is a key development in education systems across OECD countries. Governments and education authorities have been granting schools more decision-making power, including more control over financial resources or teacher hiring. In the UK, such autonomous schools are referred to as “academies”, in the United States as “charter schools” and in Sweden as “free schools”.
In a recent study, we examined the effects of this expansion on student attainment and segregation using data from 15 countries over 16 years. The key finding is that autonomous schools have not led to overall improvements in educational attainment. Instead, they have contributed to increased inequality. Students with high socioeconomic status and native students benefit, while low-status and immigrant students lose out. In addition to exacerbating existing inequalities in attainment between these groups, autonomous schools also increase classroom segregation along the same two dimensions of student background. Contrary to the expectation of universal improvement, granting schools more autonomy has resulted in system-wide increases in inequality.
The key motivation for this policy move, to grant individual schools more autonomy, is the notion that competition for students should yield positive outcomes for all. The idea is that with less central regulation, schools can differentiate, and high-performing schools should be able to attract more students. Competition, a key driver of economic welfare, is seen as a principle that can also be applied to the running of a school system.
Existing literature
A vast existing literature examines the effects of school autonomy on student performance as well as segregation. The findings are inconclusive: in some settings, autonomous schools benefit students, while in others, positive effects on attainment cannot be detected. The evidence on segregation is also mixed. Two main reasons contribute to this: first, much of the existing research focuses solely on the effects of these autonomous schools on student outcomes without investigating their effects on the education system overall.
This is crucial because a finding that students in an autonomous school perform well could be driven by sorting, potentially leading to reductions in attainment in other schools that continue to exist in the system. The other reason why drawing general conclusions from the existing literature is challenging is that many studies concentrate only on a subset of regions or even on a handful of schools. While such studies provide valuable insights into the workings of a specific setting, whether the results apply in other settings often remains unclear.
Rather than providing more “case-study” evidence in yet another setting or time-frame, our research returns to the original and very broad hypothesis: does the introduction of competition through granting schools more autonomy lead to system-wide improvements in attainment? And what are the effects of such policies on segregation?
Our methodology
The study addresses this hypothesis by combining data from the Trends in International Mathematics and Science Study (TIMMS) assessments with information about the spread of autonomous schools taken from the OECD’s annual Education at a Glance reports. TIMMS tests students in their mathematics and science abilities, providing comparable measures over time and across countries. Importantly, these tests are administered to both elementary and secondary school students. Since the spread of autonomous schools also varies across the elementary and secondary school system, the study can exploit within-country and year variation to estimate effects. In essence, this means that any other factor affecting attainment or segregation at the country-year level can be controlled for. This is an improvement over many existing studies that use data from international student assessments, which often cannot control for other potentially unobserved factors at the country-by-year level.
Classrooms become less diverse and immigrant students are more likely to be in the same class with other immigrants…
Our findings
Applying this methodology, the findings are as follows: an increasing presence of autonomous schools has no overall effects on attainment. But effects differ by student background. For example, a 10-percentage-point (pp) increase in the share of students attending autonomous schools raises math achievement by 0.02 standard deviations (SD) among high-status students but lowers it by 0.04 standard deviations among immigrant students.
An implication of this heterogeneity is that existing achievement gaps by socio-economic status and immigrant status increase. Specifically, a 10pp increase in the share of students attending autonomous schools widens the socio-economic achievement gap by five per cent and the gap between natives and immigrants by 14 per cent.
Effects on classroom segregation mirror these findings. For socio-economic status, a 10pp increase in the share of students attending autonomous schools is estimated to raise the variance ratio index status by 0.62 (about 0.14 SD) and the dissimilarity index by 0.89 (about 0.15 SD), respectively.
For immigrant status, there is a similar increase in segregation, with a coefficient of 0.043 (about 0.12 SD for a 10pp rise in the share) for the variance ratio index. In contrast, the estimated effect on the dissimilarity index by immigrant status is close to zero and insignificant.
Less diverse classrooms
What these measures capture is that there is also more physical separation of students of different backgrounds when there are more publicly funded private schools. Classrooms become less diverse and immigrant students are more likely to be in the same class with other immigrants, while other non-immigrants are more likely to be educated with other non-immigrants. The same holds for students’ socioeconomic background.
In monetary terms
How important are these effects in economic terms? To gauge this, we assess the estimates in comparison to the literature that links test scores to later wages. An influential study shows that a better teacher (one SD better in terms of value-added) increases test scores by 0.14 SD. The study says that this teacher’s students would gain approximately $39,000 on average in total (undiscounted) lifetime earnings from having this teacher instead of a median teacher.
Using this to compare the effects of autonomous schools on the maths gap between natives and immigrants would imply that a 10pp increase in the share of students attending autonomous schools increases the corresponding earnings gap by $13,929 [(0.05/0.14) ∗ $39,000]. The equivalent effect on the socio-economic status earnings gap would be $9,193 [(0.033/0.14) ∗ $39,000]. This quantification exercise necessarily relies on a number of strong assumptions, but it suggests that autonomous schools lead to non-negligible increases in future earnings inequality.
- This blog post is based on Autonomous schools, achievement and segregation, CEP discussion paper 1968.
- The post represents the views of its author(s), not the position of LSE Business Review or the London School of Economics and Political Science.
- Featured image provided by Shutterstock.
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