Quiz 6: The Economics of Education: Crisis and Reform
When compared to other countries, the United States seems to be averagely performing in the realm of K-12 education. While this might not seem like a huge problem in and of itself, it cannot be ignored that the United States spends more money per student than any other country. Education in the United States is , in fact, one of its most expensive endeavors. The crisis perception comes into play when one recognizes that the money spent on education is not providing the optimal results to fully justify the level of spending. This also reflects that it may take more than simply throwing money at educational reform in order to bring it about.
Currently, public education is a public service which everyone has the ability to benefit from without the factors of privacy or exclusivity built into it. However, if education were a private market, it would be treated more like an exclusive privilege than a valuable commodity. Functioning as a private market, education would lend itself to be treated like any other private or semiprivate good or service. It would only be sought after during periods when its benefits were felt the most, in this case, during the early stages of learning. Once the basic skills were learned, however, demand for education would decrease as it would become more and more focused on specific concentrations.
In the United States, K-12 education is offered as a public resource without the restrictions of privacy or rivalry. As such, it allows students to learn as much as they can about the world around them and enables them to decide the career or future that they desire for themselves. Because those who are successful in their educational endeavors are more likely to continue their education through college or career training and contribute their skills to society, education contributes highly to the overall marginal social benefit. Additionally, it increases work force for various companies and firms, thus increasing their marginal private benefits. Making education a private system that extracted payments from students or their parents would cause most families to not enroll their children after a certain grade level. This would reduce the number of skilled workers in society and cause a reduction in marginal social benefit. Marginal private benefit would fluctuate as there would be fewer candidates to choose from the work force. However, as these candidates would probably benefit from smaller class sizes and more time with their instructors, they would likely be more highly skilled and sought after. Their high level of skill would ultimately result in higher private benefits for the firms.