Educational policy analysis archives

Educational policy analysis archives

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Educational policy analysis archives
Arizona State University
University of South Florida
Place of Publication:
Tempe, Ariz
Tampa, Fla
Arizona State University
University of South Florida.
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Subjects / Keywords:
Education -- Research -- Periodicals ( lcsh )
non-fiction ( marcgt )
serial ( sobekcm )

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University of South Florida Library
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University of South Florida
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All applicable rights reserved by the source institution and holding location.
Resource Identifier:
E11-00036 ( USFLDC DOI )
e11.36 ( USFLDC Handle )

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Educational policy analysis archives.
n Vol. 3, no. 7 (March 31, 1995).
Tempe, Ariz. :
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Tampa, Fla. :
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c March 31, 1995
Review of Eric A. Hanushek's Making schools work / Herbert Gintis.
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1 of 4 Education Policy Analysis Archives Volume 3 Number 7March 31, 1995ISSN 1068-2341A peer-reviewed scholarly electronic journal. Editor: Gene V Glass,Glass@ASU.EDU. College of Educ ation, Arizona State University,Tempe AZ 85287-2411 Copyright 1995, the EDUCATION POLICY ANALYSIS ARCHIVES.Permission is hereby granted to copy any a rticle provided that EDUCATION POLICY ANALYSIS ARCHIVES is credited and copies are not sold.Review of Eric A. Hanushek's Making Schools WorkEric A. Hanushek. Making Schools Work: Improving Performance and Cont rolling Costs (Washington, DC: The Brookings Institutions, 1994) (200 pp. $34.95, paper $14.95) Herbert Gintis University of Massachusetts, Amherst, MA Abstract: Making Schools Work is about the economics of educational policy. The Brookings Institution, publisher of the volume, is among the most respected institutions of economic policy research in the United States. The analysis and rec ommendations offered by Eric Hanushek, Professor of Economics at the University of Rochest er, are based on original research financed by the Pew Charitable Trusts, and carried out by a distinguished group of economists. "Despite ever rising school budgets, student perfor mance has stagnated," writes Hanushek, and Making Schools Work addresses this single problem. To reverse this ten dency, Hanushek proposes three broad principles of reform: increase the efficiency of resource use, use performance incentives on schools, teachers, and ad ministrators to increase the effectiveness of teaching, and increase the rate of experimentation with educational alternatives, replacing less effective techniques and organizational forms with more effective ones Hanushek calls this "continuous learning and adaptation." In defense of this clearly economic response to the problem of educational reform, Hanushek writes "Som e have argued that schools are too important to be subject to economic rigor. We argue that, on the contrary, they are too important not to be." (p. xvii) To support the assertion that schools have become e conomically inefficient, Hanushek


2 of 4documents the fact that real per pupil expenditure has increased at the rate of about 3.5% per year (p. 31), the ratio of non-instructional to instruct ional expenditure increased from less than 20% to more than 50% of total school costs, while such ach ievement measures as SAT scores, reading achievement, and mathematics achievement have shown virtually no changes (pp. 41-43). Nor can this lack of educational output be explained by increases in the fraction of minority students, since the trends hold for whites alone, and minorit ies have made significant gains since 1980 in all these performance measures (pp. 41-43). Some will find the proposals offered in Making Schools Work harsh, economistic and unfeeling, since Hanushek appears to be asking scho ols to conform to standards of efficiency appropriate to the private sector and to activities less imbued with social meaning than the training of our youth. Others will find Making Schools Work excessively deferential to the vast bureaucracy of public schooling, its proposals tent ative to the point of impotence in the face of the entrenched interests that benefit from the main tenance of the educational status quo I believe Making Schools Work in fact falls squarely in the second category. Han ushek makes pro forma bows to the issues that economic th eory tells us are likely to be important in improving educational efficiency, but is so mindful of not importuning the educational establishment that the proposals lack any bite. For instance, Hanushek proposes that teachers be subjected to merit pay and performance contracts. H owever he proposes "two-tier" employment contracts, with incumbent teachers following tradit ional incentives, but newly hired teachers being subject to innovative incentive schemes. Ther e is no estimate of the amount of time it will take for such contractual forms, assuming they are effective for new teachers, to result in quantitative improvements in educational performanc e. He gives no economic reason for avoiding immediate implementation of incentive sche mes for teachers, but is ever attentive to the political resistance such measures encounter in the "real world" under current conditions. The reform proposals in Making Schools Work flow from the standard economic notion that an industry will deliver its product efficient ly and flexibly to its customers if there are many competing providers, each having an incentive to pr oduce efficiently with the prospect of positive reward for success, and disappearance for failure. In this case the product is "educational services," while the customers are students, parent s, and voters. However the usual economic mechanism for implementing effective incentives is a competitive product market with consumers empowered to choose among providers accor ding to their personal tastes. However, in Making Schools Work Hanushek never even mentions the fact that this i s the standard model for the delivery of services, and ne ver gives reasons why such a model is not applicable in the delivery of educational services. The question of "school choice" is mentioned favorably at one point (pp. 104-111), but is buried in a long list of possible "incentives" available to the educational system, including merit pay for teachers, merit schools and school-based management. One would hardly expect this approach f rom a group of economists working under the aegis of an economic policy institute such as t he Brookings Institution. Rather, one would expect (and I would have welcomed) a detailed treat ment of the issue of competitive educational delivery as a basic instrument for the achievement of the goal of improving the performance of the system. There are, of course, many problems in transforming American education into a competitive system attuned to the needs and wishes of parents and students, and it may very well be that a fully competitive system would be undesir able. But it is the job of economists to bring the relevant considerations before the public eye, and to address the issues in the same format as other issues in the provisionment of publicly finan ced services. Making Schools Work has simply


3 of 4 ducked these institutional and politically charged issues, producing a document that points in the right direction, but allows "political realism" to stand in the way of forthright, economically defensible, policy advice.About the AuthorHerbert Gintis is Professor of Economics at the University of Mas sachusetts at Amherst. He has jointly authored with Samuel Bowles (Univers ity of Massachusetts) Schooling in Capitalist America: Educational Reform and the Cont radictions of Economic Life (New York: Basic Books, 1976), Democracy and Capitalism: Property, Community, and the Contradictions of Modern Social Thought (New York: Basic Books, 1986), and is co-editor wi th Samuel Bowles and Bo Gustafsson (University of Uppsala) of Democracy and Markets; Participation, Accountability, and Efficiency (Cambridge: Cambridge University Press, 1993). In addition he is co-author with Christopher Jencks (Northwestern Uni versity) et al. of Inequality: A Reassessment of the Effects of Family and Schooling in America (New York: Basic Books, 1972), and is co-editor with Gerald Epstein (Univer sity of Massachusetts) of Macroeconomic Policy After the Conservative Era: Studies in Inves tment, Savings, and Finance (Cambridge: Cambridge University Press, 1995).He has also written many journal articles, has been Visiting Professor of Economics at Harvard University and the University of Paris, Visiting Pr ofessor of Sociology at Harvard University, and a Fellow of the Institute for Advanced Study, P rinceton, New Jersey. He is currently writing two books with Samuel Bowles (one on ``new microfou ndations of economic theory,'' and the other an application of this theory to economic pol icy). He is currently co-editor of the journal Metroeconomica and cochair with Professor Paul Romer (University of California, Berkeley) of the MacArthur Foundation research project ``The Hum an Side of Economic Analysis: Economic Environments and the Evolution of Norms and Prefere nces.'' Herbert GintisPhone: 413-586-7756 Fax: 413-586-6014 Department of Economics University of Massachusetts Amherst, MA 01003 Copyright 1995 by the Education Policy Analysis ArchivesEPAA can be accessed either by visiting one of its seve ral archived forms or by subscribing to the LISTSERV known as EPAA at (To sub scribe, send an email letter to whose sole contents are SUB EPAA y our-name.) As articles are published by the Archives they are sent immediately to the EPAA subscribers and simultaneously archived in three forms. Articles ar e archived on EPAA as individual files under the name of


4 of 4the author and the Volume and article number. For e xample, the article by Stephen Kemmis in Volume 1, Number 1 of the Archives can be retrieved by sending an e-mail letter to LI and making the single line in the letter read GET KEMMIS V1N1 F=MAIL. For a table of contents of the entire ARCHIVES, send the following e-mail message to LIST INDEX EPAA F=MAIL, that is, send an e-mail letter and make its single line read INDEX EPAA F=MAIL. The World Wide Web address for the Education Policy Analysis Archives is Policy Analysis Archives are "gophered" at To receive a publication guide for submitting artic les, see the EPAA World Wide Web site or send an e-mail letter to and include the single l ine GET EPAA PUBGUIDE F=MAIL. It will be sent to you by return e-mail. General questions about ap propriateness of topics or particular articles may be addressed to the Editor, Gene V Glass, Glass@asu.ed u or reach him at College of Education, Arizona Sta te University, Tempe, AZ 85287-2411. (602-965-2692)Editorial Board John Andrew Coulson Alan Davis Mark E. Thomas F. Alison I. Arlen Gullickson Ernest R. Aimee Craig B. Howley u56e3@wvnvm.bitnet William Richard M. Jaeger Benjamin Thomas Dewayne Mary P. Les Susan Bobbitt Anne L. Hugh G. Richard C. Anthony G. Rud Dennis Jay Robert Robert T.


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