Competition Among Italian Junior‐Secondary Schools: A Variance‐Decomposition Empirical Analysis

Abstract

ABSTRACTThe public economic theory emphasizes the potential role of competition in fostering the performance of educational systems. The rationale for pro‐competitive policies in education (i.e. vouchers, charter schools, tax deductions) is that schools can improve their quality responding to ‘pressures’ from nearby competitors. The objective of this paper is to analyze the potential relationship between (i) competition among schools and (ii) students’ achievement in Italy. While previous studies used OECD‐Pisa data for this purpose, here a new dataset about Italian schools has been employed: about 19,000 students in 150 schools constitute the sample. The reference framework is the idea that the presence of more schools in a certain area, and/or the proportion of students enrolled in private schools, should raise the performance of schools operating in that area through a ‘competition effect’. A multilevel strategy, which allows separating between‐areas variance in achievement scores, is employed. The findings support the view that competition has an impact, albeit little, on students’ achievement, and such competitive pressure is due to the number of schools, no matter if public or private.