A work in progress: Michigan's potent combination of interdistrict choice and charter schooling is forcing traditional public schools to take notice. Whether they respond is often a different story - Forum

Education Next, Winter, 2001 by David Arsen, David N. Plank, Gary Sykes

The Emerging Market for Schooling

Policy debates encourage single-minded positions: either school choice policies are good or they are bad. In fact, though, the systemic effects of school choice policies depend first on the local context in which the policies are implemented and second on the rules that govern the choices of parents and schools.

A state's education system comprises distinct subsystems or local ecologies. A decision by the East Lansing Public Schools to recruit additional students, for example, may mean fewer students and less revenue for nearby public, private, or charter schools. It will have little or no effect on more distant organizations, which belong to other local ecologies. So a local ecology can be thought of as the education system within an area where students might feasibly commute to class on a daily basis, Educational organizations within a local ecology engage in strategic interaction. They draw on a common pool of students and resources, so gains for one may produce losses for another.

At least five dimensions of local context are important in determining the strategic responses of education organizations to choice policies:

* Socioeconomic status. Choice policies are likely to elicit less extensive system responses in areas where high-income families reside. These families are likely to have moved to a particular area because of its excellent public schools; charter schools and neighboring districts are unlikely to draw them away.

* Socioeconomic diversity. School districts with high levels of socioeconomic diversity face significant challenges as they try to satisfy diverse educational preferences. Faced with competing demands for specialized programs (for example, vocational, bilingual, and gifted and talented programs), these districts are more likely to view new competitors as a serious threat.

* School district enrollment size. Choice policies are likely to elicit more extensive responses in large districts, where individual families have less influence over policies and programs than in small school districts.

* Population density. Low-density areas pose challenges to new entrants to the education system, including charter schools, because it is difficult for them to attract enough students to survive. Interdistrict transfers may be especially attractive in low-density areas, however, because some children must travel much farther to their local public school than they would to a school in an adjacent district.

* Population growth. When funding follows students, the impact of competition is greater in areas where school-age population growth is slow or declining, as any loss of students to charter schools or nearby districts is immediately seen on the bottom line. Schools in rapidly growing areas find that keeping pace with rising demand is trouble enough; they may even welcome the departure of students to new alternatives.

The effects of school choice also depend on the rules governing charter schools and traditional school districts. For instance, Michigan's charter school law allows many organizations to grant charters, including local school districts, intermediate school districts, community colleges, and state universities. State universities can charter schools anywhere in the state, and they have issued more than 80 percent of the charters in Michigan. As a result, most Michigan charter schools are completely autonomous from the surrounding school districts, and it is difficult for school districts to block their entry. They enter the marketplace as competitors for the students and resources of existing schools.