15-year old U.S. students ranked #24 for math in an OECD assessment program (PISA). For reading, they placed #15.
In a Teaching Company lecture called “Underperforming Schools” Wake Forest economist Robert Whaples suggests how we might raise our scores.
Cost/benefit analysis: Dr. Whaples started with what we spend per pupil and then what we get. We spend, on average, $10,000 annually. What do we get? Ranked #24 in math and #15 in reading. New Jersey spends a lot more than Utah but their testing results are close. Even spending more on small classes does not seem to reap consistent benefits. So, is there a connection between educational achievement and spending? Are we sufficiently productive? He concluded, “Not necessarily.”
Incentives: The next step then is to look specifically at teachers and students. Do teachers need different incentives such as merit pay? It is tough to design appropriate criteria. Would students do better if they had to take demanding “exit exams?” Some students excel with more pressure while weaker students drop out.
Competition: Maybe vouchers and charter schools elevate student achievement by challenging enrollment at existing schools (that are monopolies). Here, Whaples said to look at the work of Stanford economist Caroline Hoxby whose research concludes that competition can make a big difference.
Where does all of this take us? Most economists suggest that more “consumer sovereignty” would be desirable.
The Economic Lesson
In addition to productivity, incentives, and competition, economists use the idea of value-added to assess school quality. While value-added typically refers to a tax (VAT), for education, it takes us to student achievement. Stanford economist Eric Hanushek with 3 colleagues sought to measure teacher “value-added” through student achievement.