Competition for Contracts with Public Schools and Districts: How Much is There, and Does It Matter for Students?

Nora Gordon

Public schools and districts are increasingly turning to private entities to purchase goods and services, including curricula, data management systems, and professional development. When private providers face little pressure from competitors (monopoly is the extreme case), they have the power to inflate prices and/or reduce quality. The competitiveness of these markets thus has important implications for educational quality. I will gather data on and examine the structure of the markets for several of the main goods and services schools and districts purchase. Research questions include the following: (1) Why are some districts more competitive markets than others? Do demographic factors, such as language proficiency of students, limit the number of providers in a market? Do differences in local governance affect competitiveness? (2) Which goods and services lend themselves to more concentrated markets, and why? (3) What are the effects of a concentrated market? To what extent do contractors actually charge higher prices or offer lower quality goods and services when they have a greater share of the market? (4) Do these welfare implications differ if the contractors are not-for-profit versus for-profit, and how? (5) How have states and/or districts tried to promote competition through regulation? How should they?

About Nora Gordon

Nora Gordon is assistant professor of economics at the University of California, San Diego, where she teaches courses in public economics and the economics of education. She is also a faculty research fellow at the National Bureau of Economic Research. Nora received her PhD in economics from Harvard University in 2002. Her research has focused on education finance in a federalist context. She has written on the fungibility of Title I grants, how court-ordered state school finance reforms affect the distribution of other (non-education) state grants to local jurisdictions, the causes and effects of school district consolidation, and the historical role of Title I in furthering school desegregation.