School Choice and Job Training

Published February 1, 2002

What if, for a moment, we look at publicly funded school choice programs as “government-sponsored training programs”? After all, the U.S. government and many state governments sponsor training programs and give people money to attend them.

That’s what Harvard University economics professor Caroline Minter Hoxby invited the audience to do at a school choice conference in early 2000. She wanted her audience to evaluate the gains achieved by the private voucher program in Dayton, Ohio using the same measures by which other, similar government programs are evaluated.

Hoxby pointed out that schools and training programs are reasonably considered substitutes for each other, since “kids who get out of school and cannot read will eventually end up in these training programs.”

What Constitutes a “Win”?

With a participation cost of only about $2,200 for 180 days of “training,” the Dayton voucher program produced an average gain among “trainees” of three National Percentile Ranking points in reading and six in math. Such test-score gains would produce a 10 to 15 percent wage gain for the trainee, Hoxby said.

“This is the highest benefit [to] cost ratio that I was able to find,” reported Hoxby. “I compared this ratio with a Department of Labor write-up on all the training programs sponsored over the past 30 years, taking their cost-benefit ratios to be correct, and this ratio was the highest.”

Voucher opponents caution that the students using vouchers are not the most dysfunctional . . . yet that is rarely a concern with training programs, Hoxby continued. Others worry that voucher participants might choose private schools for “the wrong reasons,” but that issue is not considered important when evaluating training programs.

In fact, explained Hoxby, a training program that has any statistically significant positive effect is generally considered to be a “win.”

Noting that a recent training program was considered a success even though it had produced a gain in only one county out of six, Hoxby suggested the government should not be setting different thresholds of success for public investments in programs with similar goals.

“If this had been charters or vouchers, I do not think that we would have had the same interpretation,” she noted.

For more information

The complete text of Caroline Minter Hoxby’s comments can be found on pages 82-88 of the transcript of the 2000 Cambridge School Choice Conference, available from The Manhattan Institute’s Web site at