Socio-economic Segregation with (without) Competitive Education Policies. A Comparative Analysis of Argentina and Chile

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Socio-economic Segregation with(without) Competitive EducationPolicies. A Comparative Analysis ofArgentina and ChileMariano Narodowski & Milagros NoresPublished online: 28 Jun 2010.

To cite this article: Mariano Narodowski & Milagros Nores (2002) Socio-economicSegregation with (without) Competitive Education Policies. A ComparativeAnalysis of Argentina and Chile, Comparative Education, 38:4, 429-451, DOI:10.1080/0305006022000030720

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Comparative Education Volume 38 No. 4 2002 pp. 429–451

Socio-economic Segregation with(without) Competitive EducationPolicies. A Comparative Analysis ofArgentina and ChileMARIANO NARODOWSKI & MILAGROS NORES

ABSTRACT Within the differentiated forms of education provision, this paper intends to inquire intothe causality governing the relation between the use of vouchers in education and an increasedenrolment segmentation or student sorting. It does so through a comparative analysis of thequasi-market reform in Chile and the quasi-monopoly system in place in Argentina. Although froma national perspective these two countries have faced very different decentralisation reforms, theyhave presently arrived at similar states of their education system in terms of their enrolments’socio-economic segregation. The paper shows that vouchers are not an independent variable but anintervening one within the determinants of socio-economic segmentation. The evidence from Chile andArgentina shows that enrolment segmentation is not a consequence of the introduction of vouchers,and the causal relationship between these two variables is not a clear one. That is, the family schoolchoice decisions brought about by the introduction of systems such as vouchers appear endogenous toa series of factors that determine such choice; factors that that are evidently important in thedetermination of socio-economic enrolment segmentations in non-voucher systems. This articlequestions the validity of the highly predominant empirical analyses which take student socio-economiccharacteristics and school choice decisions as independent determinant variables of student results, andintends initiating further thinking of what really lies behind the inequities in education in developingcountries.

The last decades can be characterised by the scale, number and content of the educationpolicies developed worldwide. Originating in the north—North America and Europe—a tidalwave of thinking about the downfall of the Welfare State swept over Latin America in the1980s, and consequently, some education policies were ‘dramatically altered to re� ectchanged economic policies’ (Arnove, 1997, p. 79). With the intent of improving administrat-ive ef� ciency, school quality, and school equity in education the current trend has meant animportant transformation of the national state’s role in education in favour of an increasedrole of lower government levels. This has not necessarily meant an increase in control at themicro-levels, that is, at the schools.

However, while as an international trend education decentralisation has been widelyrecognised, its uncritical acceptance as a concept in itself can fail to identify its variety within

Correspondence to: Mariano Narodowski, C.C. 105, B1876BXD, Bernal, Buenos Aires, Argentina. Email:

[email protected]

ISSN 0305-0068 print; ISSN 1360-0486 online/02/040429-23 Ó 2002 Taylor & Francis Ltd

DOI: 10.1080/0305006022000030720

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430 M. Narodowski & M. Nores

the different educational systems (Bullock & Thomas, 1997). As Whitty et al. (1998, p. 23)describe in their study of the redistribution of power in England and Wales, Sweden, NewZealand, Australia and the USA, the complexity of the reforms in these countries derivesfrom the many meanings behind the concepts of devolution and choice. In their belief, thisis related to Lauglo’s description of the diverse implications brought about by different formsof decentralisation (Lauglo, 1996, as cited in Whitty et al., 1998).

More speci� cally, Welsh and McGinn (1998) de� ne decentralisation as being ‘aboutshifts in the location of those who govern, about transfers of authority from those in onelocation or level vis-a-vis educational organisations, to those in another level’ (p. 3). Addi-tionally, they recognise three major positions in the con� ict about who should governeducation: political legitimacy, professional expertise and market ef� ciency. The authors statethat the fundamental difference between these three is in terms of the justi� cation for holdingauthority. Political legitimacy is about governance of education being legitimated by individ-uals who have been selected through a political process; professional expertise in governancerefers to authority being assigned primarily to those with technical expertise in the matter;and � nally, the market ef� ciency position brings into play a differentiation between gover-nance of production and governance of consumption of education. Welsh and McGinn(1998) do not view these three as mutually exclusive.

Chile has been in Latin America a regional reference in terms of educational decentralis-ation reforms (although this has been so not only in education). As such it has been widelystudied (Aedo & Larranaga, 1994; Bullock & Thomas, 1997; Carnoy, 1997, 1998; Carnoy& McEwan, 1998, 2000; Gauri, 1999; McEwan, 2000a, b; Bel� eld, 2001; Bravo et al., 1999;Contreras, 2001; Mizala & Romaguera, 1998, 2000; Parry, 1997a, b; Patrinos & Ariasing-man, 1998; Rodriguez, 1988; Viola Espinola, 1992, undated; Welsh & McGinn, 1998; West,1996; and others) because of the decentralisation and market reforms introduced during the1980s. Presently, the model of education provision and administration in place in Chile isone of a quasi-market; public � nance of education with supply competition in the productionof it, and involving public and private suppliers [1].

On the other hand, Argentina represents a model of public provision of schoolinginherited from a strong welfare state that faced a series of national state reduction reformsduring the 1990s over the basis of issues of ef� ciency and federal legitimacy. This system,which we categorise as a quasi-monopoly one, has an exit [2] option to a proportion of itsschool population to the private sector, and it even promotes such exit through a statesubsidisation of private schools. In analysing the concept of ‘quasi-monopoly’ we draw uponthe work of Narodowski and Nores (2001) who develop a taxonomy of models of educationprovision and differentiate pure monopolies from quasi-monopolies, that is, models of stateprovision that have embedded exit options but that do not contemplate supply competition,in contrast to quasi-markets, which do so.

Therefore, a comparative analysis of Argentina and Chile implies a comparison of twocountries. Although from a national perspective they have faced very different decentralis-ation reforms that have meant a shift in the locus of governance, which has taken place withintwo very different sets of regulatory frameworks, they have presently arrived at similar statesof their education system in terms of their enrolments’ socio-economic segregation. That is,different models of schooling provision, different types of education markets and regulations,but apparently similar results.

In both cases, in the strategy adopted towards private education, an imperative need forsolving supply problems at the middle level has predominated, as well as � nancial restraintsto the system as a whole. Consequently, the decentralisation reform to the municipal level inChile, as well as the decentralisation reform to the provincial levels in Argentina, have

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A Comparative Analysis of Argentina and Chile 431

FIG. 1. Relationships between competition , privatisation and socio-economic segmentation.

answered to the corresponding national governments’ ef� ciency needs for the provision ofeducation.

Within the differentiated forms of education provision, this paper intends to inquire intothe causality governing the relation between the use of vouchers in education and anincreased enrolment segmentation or student sorting. The interest in this theme comes froman in-depth knowledge of the Argentine education system, where we have observed thatnotwithstanding the non-existence of vouchers, or any similar form of competitive model ofeducation provision, some of the most important objections to such policies are, however,especially valid.

Theoretical Approach

There is a fairly predominant view in the literature (against competition, voucher and charterschool initiatives), that such reforms increase student sorting across individual characteristicssuch as race, class, etc. Several authors have argued that because school choice policiesinduce families to leave public schools, they heavily promote enrolment segmentation(McEwan, 2000b; Doerr et al., 1996; Smith & Meier, 1995; Graubard & Rothstein, 1998;Carnoy, 1997; Cobb & Glass, 1999; Hassel, 1997; and others). Mostly, such approaches tothe problem of socio-economic segregation have to do with seeing the relationship betweenvouchers and this kind of segmentation as a positive causality where the implementation ofvouchers in an education system produces increased segmentation (see Figure 1, Chile).However, much the same results can be found in centralised education systems that haveexplicitly avoided the introduction of vouchers (see Figure 1, Argentina). Therefore, thiswork intends to disturb the assumption that vouchers are a necessary condition for socio-economic segmentation and even question it as a suf� cient condition.

While opponents of school choice policies usually argue that vouchers induce enrolmentprivatisation and hence, enrolment segmentation, the evidence from Chile and Argentinashows that enrolment segmentation is not necessarily a consequence of the introduction ofvouchers. While for Chile that argument might be valid, it is not so for Argentina. Therefore,vouchers are an intervening variable in the determinants of a country’s socio-economicsegmentation, but are not an independent variable. The school choice decisions broughtabout by the introduction of vouchers are endogenous to a series of factors that determinesuch choice, which also play an important role in the determination of socio-economicenrolment segmentations in non-voucher systems. Consequently, this article questions thevalidity of empirical analyses which have considered student socio-economic characteristicsand school choice decisions as independent determinant variables of student results, whichpredominates in the analysis of competition policies.

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Chile: 20 years of a quasi-market system of education

Historical Perspective

Before the 1980s and since at least the second half of the nineteenth century, the predomi-nant state model in Latin America was that of a liberal state that tightly controlled the publiceducation system. Such control meant a thorough regulation of the inputs of the schoolingprocess by the national states within their intention of establishing the foundations of thenation and the citizenship (Weinberg, 1984; Torres & Puiggros, 1997). As Torres andPuiggros state, the implementation of a welfare-oriented public policy has been a centralelement of the Latin American state, that is, a welfare state with an intense interventionistrole that included the protection of minimum standards on income, nutrition, health, housingand education. Such a state was preceded by state authoritarianism (in the 1980s) and, in theaftermath, a return to liberal-democratic governments. Within this framework the history ofeducation in Argentina and Chile did not differ signi� cantly until the 1980s, when Chilemade a shift that sent its education system along a completely different path.

Basically, in Chile, during the � rst half of the twentieth century the trend of the systemwas towards increased centralisation and an accelerated involvement of the state whichresulted in the concept of the ‘Teaching State’ (Matte & Sancho, 1991). Therefore, up untilthe1980s, the education system provided schooling through its simultaneous provision and� nance on one hand, and by additionally subsidising private schools. The traditional privatesubsidised supply consisted mainly of urban primary schools serving middle- and low-incomefamilies, half of which were Catholic and with an average subsidy of school expenses ofaround 60 to 65% (Viola Espinola, 1992), which in reality—taking into account the formsand amounts of payments—meant a funding of 25% of the per student cost at of� cial schools(Panadeiros et al., 1998).

Almost all responsibilities for primary and secondary education were at the centre, whichadministrated the system through a strong regulatory framework, that included sharp controlover private schools. Even the administration of human resources was centralised, with anational salary scale and centralised decision-making on school appointments. In terms offunding, this centralised system meant that resources were assigned to schools on the basisof historical budgets (Panadeiros et al. 1998).

With the educational reform implemented during the 1980s, the predominating conceptwas of public funding of education, clearly de� ned as a separate action from the productionof education in itself. The scheme put into place implied an equal funding of all childrenattending both public schools—with its administration being decentralised to the municipallevel—and private schools incorporated in the subsidy regime. This centralised � nancialscheme within a decentralised administrative system was extended for pre-school, primaryand secondary education (although the Constitution of 1980 only guarantees free primaryeducation), with the level of per student funding varying correspondingly (Matte & Sancho,1991).

The underlying principles embodied in the model of education that was developedduring these years answered to a clear recognition of the need to provide basic education forall, and an intention to promote equality of opportunities, as re� ected by the capitationfunding mechanism (Panadeiros et al., 1998). Such principles were to be ful� lled at thelowest ef� ciency costs, that is, through the participation of the private sector. Additionally,this strategy also answered to an excess of demand that had to be satis� ed.

Speci� cally, Panadeiros et al. (1998) describe three main components of the reform: (a)a transference of public education establishments from the central government to themunicipal level; (b) a transference of middle technical-professional schools to non-pro� t

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business organisations; and (c) the replacement of the existing supply-based funding mechan-ism to a demand-side funding scheme which private non-pro� t schools could apply for. Thetransference in itself was not complete until 1986, partly as a consequence of the economiccrisis the country went through in the early 1980s and because of the introduction of a seriesof market distortions during those years [3].

In the 1990s, the Chilean transition-to-democracy government put into the educationalpolicy agenda the issues of both education quality and equity. Therefore, pro-active policiesand initiatives for positive discrimination, as well as initiatives intended to strengthen theeducational system’s institutional capacities were dominant from the central government’sperspective. All these were developed within the existing decentralised and pro-competitiveeducation system.

Consequently, the per student � nance system for public and private subsidised schoolswas preserved, with an increase in education spending so as to reverse the tendency of the1980s of decreasing resources in the sector (only in 1994 was the per student spending of1982 surpassed). Additionally, within a tax reform of 1993, privately subsidised primary andsecondary schools and municipal secondary schools were allowed to opt for a mixed fundingscheme [4]. By 1997, 25% of the enrolment was within this scheme (Cox, 1997). Such areform clearly promotes a greater enrolment segmentation by income levels, as those who cannot pay the tuition fees imposed face limited school choices. Additionally, compensatorypolicies have apparently been insuf� cient to compensate for the costs imposed by thisinitiative on the lowest income groups (Viola Esp õ nola, undated).

Furthermore, during the initial democratic years a teacher statute was enacted (and fouryears later reformed) [5]. This norm was highly regulatory, and even considered a stepbackwards from the existing decentralised system. The rigidity it brought to schools in termsof teachers’ mobility meant a limitation on the schools’ administrative capacities, butapparently was of utmost importance in increasing feasibility for subsequent educationprogrammes (Cox, 1997). However, such rigidity was signi� cantly reduced by the 1995 Lawof Teacher Statute Reform. Two programmes were the consequence of this reform, PADEM(a development programme for municipal education) and SNED (a system intended to assessthe performance of the schools’ teacher teams). As a consequence of the reforms andincreased funding, teacher salaries increased 80% between 1990 and 1997 (Cox, 1997).

Finally, the 1990s in Chile are marked by the introduction of compensatory policies.Such policies are the re� ection of the prevalent concept of positive discrimination that is, asReimers (2000, p. 94) states, relatively recent in education policy discourse in Latin America.Such policies in Chile took the form of interventions at different need levels [6]. During theearly 1990s a programme known as P900 was set in place, which targeted the lowest 10%basic education schools (lowest in terms of education results) with direct and technical aidssuch as infrastructure, textbooks, didactic teaching material, class libraries, and innovationwith monitors for children’s schooling reinforcement (Cox, 1997). Additionally, theMECE-Basica programme is a systemic intervention on basic education that includedmaterial, technical and pedagogical components; and, the MECE-Media (1995) was devel-oped for middle education with innovation and investment components [7]. In addition,other policies were developed: an extension of the school day, a networking of outstandingschools and a strengthening of teacher training programmes.

The Model

The present education trend promoting the introduction of competitive markets can begrouped into two lines of thought. That is, competitive forces in education can be introduced

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for two alternative reasons: as instruments for systemic change or as mechanisms for integralchange. Lane (1999) introduces the concepts of ‘integral reform’ vs. ‘systemic reform’. Underthe argument for an integral reform of the education system Lane considers charter schoolsas an additional component of national and state efforts to modify and change traditionalpublic schools, in opposition to being an instrument for systemic reform intending torestructure the system completely. In short, as an alternative within, and not to, publiceducation. Lane’s categorisation into these two theoretical perspectives of what charterschools can generate in the existing educational systems can be generalised for school choicepolicies in general.

Chile’s reform has been described as a voucher model by an important number ofauthors analysing it (Parry, 1997a, b; Carnoy & McEwan, 1998, 2000; Bullock & Thomas,1997; West, 1996; Carnoy, 1997; and others). On the other hand, Welsh and McGinn(1998) have described it as a charter school model of education provision. Actually, the maindifference between vouchers and charter schools (these being alternative school choicemodels) lies in how the subsidy reaches the school: the voucher is much more liquid (in theeconomic sense) for parents and students than the transfer of funds to the schools on thebasis of their student enrolment. Notwithstanding this difference in its form, the Chileaneducation reform falls into what Lane (1999) called a charter as an instrument for systemicreform. The model integrated into a single market traditional public schools together withprivate subsidised schools, with an explicit intention of making all public schooling subject tomarket rules.

Chile’s school choice reform answered mostly to immediate needs such as greateref� ciency, higher educational quality, higher equity, and the need to solve the existing accessproblems of the secondary education level. It can be categorised as a quasi-market model ofeducational provision, since it complies with the general characteristics of such a market, thatis, public funding of the service with its provision being in a competitive market where publicand/or private organisations take part. In education, Levacic (1995), as cited in Gordon andWhitty (1997), describes the salient characteristic of this market as being the separationbetween the provider and the producer of schooling, with the simultaneous introduction ofconsumer choice elements into the relation between supply and demand. As Vandenberghe(1999, p. 273) states, quasi-markets form a subtle combination of the principle of publicfunding with corresponding bureaucratic controls, and a ‘market-oriented, competition-driven approach to education’.

Basically, school choice proposals are based on a series of perceptions about thestructure, the behaviour, and the output of the dynamics of competitive markets. In themarket logic, consumers play a central role because they reveal information about theirpreferences through their interaction with the supply side. On the basis of these sets ofpreferences, the supply adjusts its decisions about what, how much and at what price itshould be offered. This supply and demand interaction brings the production of thegood/service closer to the consumers’ interests; that is, consumer sovereignty guides themarket to its best outcome (Aoki & Feiner, 1996). In education, this process implies thateducation supply is brought to behave as in the private sector, with a multiplicity of suppliers(public and private) competing for students.

The real effect, size, and implications of a school market, when introduced, depend onits particularities. As Levin (1992) states, different speci� cs can eventually lead to extremelydifferent results in practice, with the � nancial, regulation, and information provision of thesystem being of particular importance. It is evident that differences in the particularities of themodel implemented answer to very different ideals and goals in terms of education equity andquality. Similarly, Arons (1971) de� nes the voucher scheme as malleable in its basic design,

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TABLE I. The Chilean model of school choice

Component Speci� ed

Participation

Municipal schools 3

Private schools 3

Regulation 3

Curriculum speci� cation 3

Teacher certi� cation X

Teacher salaries X*

Minimum infrastructure 3

Student admission standards X

Marketing X

Textbooks X

FinanceParental additional funding 3**

Compensatory funding X

Transportation provision X

Textbook provision XInformation

Assessment 3

Public provision of information X

* The teacher statute of 1990 had several implica-

tions for teachers ’ minimum working conditions .

** The funding mechanism was modi� ed by law in

1993 to allow for mixed funding between state and

parents through tuition fees.

Source: elaborated on the basis of Levin (1992).

with the speci� c design being deterministic in its results. With this in mind, the school choicemodel in Chile can be described in the basis of the mentioned three components, whichdetermine the form the model will take in practice (which applies only for included schools).That is, it de� nes the rules of the game under which schools compete for students.

As can be seen in Table I, the Chilean model allows for access to public resources toboth public and private schools. Additionally, it includes the regulatory components ofcurriculum speci� cation and minimum infrastructure requirements, a � nance componentallowing for additional parental funding over and above public resources, and an informationcomponent that includes assessment of students’ results. Apparently, the model puts empha-sis on controlling the output and content of schooling, but eliminates regulation over inputs,except for requiring compliance with minimum requirements on infrastructure and teachersalaries (the teacher statute establishes minimum working conditions). Additionally, the 1993amendment that allows for schools to opt for mixed funding (only private-subsidised schoolsat the basic level, and all schools at the middle level) has important equity implications [8],as does the fact that student admission mechanisms are not regulated and although municipalschools have to admit every student at their door, this is not true for private subsidisedschools.

Enrolment Privatisation and its Socio-economic Segmentation

After the implementation of the per student subsidy for public and subscribed privateschools, private subsidised enrolment grew enormously in Chile (see Figure 2). Between

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FIG. 2. Evolution of school enrolments in Chile, 1981–1999 (thousands).

1981 and 1991, private subsidised enrolment increased 57%, that is, it went from approxi-mately 430,000 children to 950,000 (which implies an average annual growth rate of 12%).And in the last decade it did so even more, having increased up to 1.2 million by 1999. Inshort, it experienced a 180% variation in two decades. The growth in private non-subsidisedenrolment was much smaller, with an increase of 20% in the � rst decade (2% on average, peryear), adding up to a variation of 57% by 1999. In contrast, public school enrolmentsdecreased 21% between 1981 and 1991, and from there on grew steadily. However, in 1999,enrolments in the public sector were still below what they used to be in 1981. Such aprivatisation of enrolment has been mostly a consequence of the incentive for privatelyadministered schools to enter the market, established by the per student subsidy allocated(which in fact was initially higher than the pre-existing mean expenditure per student).

The main criticisms of the model have concentrated on two issues. On the one hand, onthe socio-economic segmentation it has produced in its student population as evidenced bythe socio-economic characteristics of each child, and on the other, on the lack of clearevidence of private school effectiveness under such a school choice scheme.

A descriptive-statistics approach of analysis of the effects of the reform done by ViolaEsp õ nola (1992) describes the enrolment segmentation. Overall, while the higher incomegroups—urban and rural—have chosen the private system, the lower income households havestayed in the municipal system. However, the author found that although the gap betweenhigher and lower income groups tended to be stable in private subsidised schools, it widenedunder the municipal schooling system, apparently evidencing the higher compensatory abilityof the � rst. A series of studies done by the Chilean Ministry of Planning and Cooperation(1999a, b, c) also show the segmentation of the different income levels by school depen-dency.

The 1998 distribution of school enrolment by income level for each type of education isdescribed in Table II. Evidently, what Viola Esp õ nola described for 1990 is still evident in the1998 data. The highest quintile mostly attends private non-subsidised schools, the fourth andthird quintile attends municipal and private subsidised schools in similar proportions, and the

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TABLE II. Population aged 0–24 enrolled by Income Level, Type of Education and Dependency, 1998

National Quintile

Education type Dependency I II III IV V Total

Basic Municipal 75.3 63.7 54.5 40.4 18.9 57.5

Private Subsidised 24.2 35.1 42.3 48.3 28.0 33.8

Private Non-Subsidised 0.5 1.1 3.1 11.3 53.2 8.4

Total 100 100 100 100 100 100

Middle Science Municipal 78.6 66.8 59.0 45.0 22.3 53.8

and Humanities Private Subsidised 18.3 28.4 33.8 38.9 25.8 29.2

Private Non-Subsidised 2.6 3.9 6.9 15.2 51.7 16.5

Corporation 0.4 0.9 0.2 1.0 0.2 0.5

Total 100 100 100 100 100 100

Middle Technical Municipal 50.6 47.1 47.1 42.3 25 46.4

and Professional Private Subsidised 36.3 37.8 39.5 43.9 51.1 39.3

Private Non-Subsidised — — — — — 1.3

Corporation 12.4 14.0 13.1 12.5 13.8 13.1

Total 99.3 98.9 99.7 98.7 89.9 100.1

Source: Ministry of Planning and Cooperation (1999b).

lower quintiles are highly concentrated in municipal schools. Such segmentation is observedfor basic as well as middle education levels. While 75% of the lowest quintile attendmunicipal basic education, only 19% of the � fth quintile do so. At this same education level,although private subsidised schools do not predominantly serve the highest quintile, it is stillbiased towards serving the fourth quintile (48%) more than the municipal sector does (40%).

A large set of studies about the Chilean education system have used an econometricapproach to analyse private and municipal school effectiveness (and ef� ciency). Most of theseare summarised in Table III. Basically, all these studies agree on the fact that the rough gapin student achievement test scores—the predominant measure of school quality these studiesuse—between public and private subsidised schools is highly determined by differences instudents’ socio-economic background. Parry (1997a) reached the conclusion that each typeof school specialises: public schools targeting socio-economically disadvantaged students andprivate schools producing higher scores with ‘high quality’ students. Similarly, Mizala andRomaguera (1998, 2000) recognise the existence of signi� cant differences on the supply’sgeographical distribution for each type of school, and of the income levels of the childrenattending these, which in turn has a strong correlation with the type of school. And Bravo etal. (1999) trace a greater concentration of lower quintile students in public schools and asimilar concentration of higher quintile students on private schools (whether subsidised ornot).

Mostly, these studies try to identify private vs. public schools differences searching tounderstand the implications of nation-wide school choice experiences. All studies having useddata for years previous to 1990 (included) found a higher test score achievement of privatesubsidised schools after controlling for socio-economic characteristics (measured by familyincome and/or parental education) and other geographic and school-quality related variables(i.e. class size, teacher experience, non-teaching assistants, and failure rates, among others).

Furthermore, the study by Bravo et al., which covers all assessed years (by the nationalassessment systems [9] between 1982 and 1997, found that public and private subsidisedschools have equally distributed educational results (and this has remained stable) and that

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private subsidised superiority over municipal schools, having controlled for school socio-economic variables, has decreased during the 1990s. This result is similar to that ofthe authors analysing post-1990 data sets, that is as Carnoy and McEwan (1998, 2000),McEwan (2000a, b), Mizala and Romaguera (1998) showed. However, altogether, studies onthe effectiveness of private schools in the Chilean educational system have found a set ofmixed results for post-1990 data sets. If a private subsidised superiority has been found,such superiority in terms of test scores is small, having controlled for available data onsocio-economic characteristics.

It is worth noting that the study done by Contreras (2001) is the only one of thesestudies which uses a different data source, that is, individual student data. With two-stageleast squares estimations to control for school choice, the author shows that the impact ofprivate subsidised schools is larger than the estimation by ordinary least squares results in,and therefore concludes that the Chilean model actually succeeds as an instrument of socialmobility.

These results have to be put into context with what has happened in the legislative andpolitical arena during this decade. As a matter of fact, although the value of the per studentsubsidy initially decreased because of an economic crisis that affected all public funding, andwith the exception of the interruption of the assessment system, there were no importantchanges in the direction of the policy in place or in the commitment with the reform throughthe 1980s.

On the other hand, the 1990s have been characterised by an important set of changes inthe policy rules that determined the institutional characteristics of the market game. On theone hand, as occurred in most Latin American countries, an important set of compensatorypolicies was put into place, some of which directly affected the budget of public schools.Additionally, as has been already mentioned, the funding scheme of the previous decade waschanged to allow for the existence of complementary sources of school funding by the privatesector, either from parents themselves, or through tax-deductible donations.

Drawing from these studies’ results, it is plausible to hypothesise that the decrease/disappearance of the difference in subsidised private school effectiveness as measured againstthat of municipal schools, as Bravo et al. (1999) observe, may be interpreted either as aproblem of private subsidised schools, or, more interestingly, as a model of success. That is,that the competitive pressures introduced by it have brought about a municipal school qualityimprovement. Even Carnoy and McEwan (2000, p. 228) recognise such a possibility.

Theoretically, competitive forces bring a market to equilibrium. In the present model,such competitive pressures mean a competition on the sphere of quality, since subsidisedschools can not compete on prices—their price is � xed at the per student subsidy—they doso on the quality sphere. In Chile, it is plausible to hypothesise that once the subsidy wasestablished and the market opened, schools entered the market taking advantage of the publicfunding of education. However, as the threat this meant to municipal schools became visible,this worked as an incentive for such schools to improve, in order to retain their alreadyweakened demand. This meant quality improvements that narrowed down the differencebetween the private subsidised sector and municipal schools in terms of results (once havingcorrected for the population they served), although both sectors were improving in terms ofachievement results.

Argentina: over 50 years of a quasi-monopoly in education

Historical Perspective

As was mentioned before, up until the 1980s, the Argentine education system’s progress did

Dow

nloa

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by [

Way

ne S

tate

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at 0

7:01

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Nov

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14

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not differ much from what took place in its neighbouring country. While Chile broke with theliberal state’s strong regulation of education, Argentina has not done so in such a stark way,and to the same degree. On the contrary, Argentina’s education reforms are concentrated inthe early 1990s—together with the introduction of compensatory policies—and are still on-going, and although these have brought about an important amount of changes in the system,they have not implied a strong deviation from previous policy.

Argentina’s present education system is mainly based on the organisation and disciplineof pre-existing schooling provision, which were diverse and mainly of denominational origin.By the end of the nineteenth century, the Schools Directorate (Direccion de Escuelas) of eachprovince, together with the National Education Council (Consejo Nacional de Educaion)created the institutional basis on which rules on school � nance, administration and organis-ation were established, and all schools started to depend upon these. As stated in a previouswork (Narodowski, 2000), in Argentina the governments managed a ‘statalisation’ of schoolswhich is re� ected in the monopolistic provision of education which was agreed on, and thathas continued to the present based on an underlying ‘consensus’ on education. A re� ectionof this underlying ‘consensus’ is the fact that Argentina lacked an organic education law upto the enactment of the Federal Education Law of 1993 (Ley Federal de Educacion). The workemphasises that the State’s education policies, their � rmness and their effectiveness, allthrough the twentieth century were founded on very few parliamentary regulations.

After the 1950s, the educational system faced a strong legitimacy loss related to the factthat the system was not able to ful� l its promise of social mobility. Additionally, the legalequalisation that the State gave to private education institutions—such as the elimination ofprivate school students to take equivalency examinations at public schools so as to receivetheir certi� cation—(Narodowski & Andrada, 2001). Also, private-school subsidies wereregularised by the end of the 1940s [10] but the Government-Church con� ict of the 1950s[11] left subsidies during that decade to be mainly de� ned with a high degree of discretionarypower for institutions (Morduchowicz et al., 1999). However, only in 1964 were ‘objective’parameters and criteria established for private subsidy allocation [12], although until todaythe amounts allocated per school lack any clear consistency (Morduchowicz et al., 1999) andfrequently answer to client-oriented criteria (Narodowski, 2000).

From these years on, the Argentine educational system has preserved its main character-istics, and built on them. That is, although the main principles have not changed much, andat the macro-level the system remained mainly the same, at the micro-level it has constantlygrown, which has led to a hyper-regulation of public schools (Narodowski, 1999). Incontrast, in the private sector this has not happened, and therefore there has been a relativederegulation of this sector. Most substantial reforms during the 1970s took place in theteacher training � eld (Narodowski, 2000), when the military regime eliminated the tra-ditional Normal Schools and teacher training started to be provided by tertiary non-universityinstitutions.

Furthermore, the decentralisation reforms of 1978 (transference of primary nationalschools to the provincial governments) and 1992 (transference of middle schools to theprovincial level) dismantled the federal government’s structure of schooling provision on thebasis of � nancial and economic needs. However, such decentralisation initiatives have meanta loss of federal government control in favour of the provincial levels, but has not meantincreased school autonomy. Finally, the 1993 Federal Education Law [13] brought about aformal and long-needed organisation of the education system, extending compulsory edu-cation and restructuring its levels. As ascertained in a former study (Narodowski, 2000), nomajor novelties surfaced in terms of strategic State prevalence and control in educationpolicy, except for its curricular component. These last reforms had little implication for

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school autonomy and everyday schooling activities. Although the last series of reformsimplied a discourse shift from input-based control of education to output-based provision ofeducation, in reality they only implied an additional normative layer. The last 30 years ineducation policy have generated a hyper-regulated impoverished state system coexistent witha highly autonomous and expanded private sector.

The Model

Argentina’s model of public provision of education has the particularity of mixing a strongwelfare state inherited from the post-World War II era with a series of reforms on the basisof issues of ef� ciency and federal legitimacy that have been layered over, instead of replacing,the former. Such a model of education provision can be categorised as a quasi-monopoly one.

The quasi-monopoly de� nition hereby considered is based on the work done byNarodowski and Nores (2001). As mentioned before, they elaborate a taxonomy of educationprovision models. Their main contribution is the differentiation of pure monopolies fromquasi-monopolies, that is, models of state provision that have embedded ‘exit’ options butthat do not contemplate the promotion of supply competition or market-oriented provisionas quasi-markets do. Explicitly, if a monopoly and a market model could be thought of aslinear opposites and the distance between these two a continuum, a quasi-monopoly ofeducation provision would be somewhere between a pure monopoly and a quasi-market.

Argentina � ts into this category, predominantly because it evolved into a system wherethe main form of education provision is that of public education, supplied by a centralisedState (presently provincial states), with an effective and state promoted exit option. This exitalternative is the private sector, which the state furthers through institutionalised subsidyassistance. Therefore, although the decentralised system does not establish a competitivesetting for all schools, it does � nance a segment of the supply that draws students from thetotal enrolment pool, and allows such a segment to be part of a competitive market (togetherwith non-subsidised private schools) while not introducing any competitive incentives, and/orderegulating the traditional public school system that has increasingly lost legitimacy.

Decentralisation in Argentina did not change the system’s form of governance though itchanged its locus. Although the provincial levels are responsible for the educational serviceprovided under their jurisdiction, it is not true, from the schools’ perspective, that this hastranslated itself into greater school autonomy. Such school autonomy however, has alwaysbeen present in the private subsidised sector, and this has not changed with the decentralis-ation reform.

Enrolment Privatisation and Socio-economic Segmentation

Since the legal equalisation of the private sector’s school supply in the 1960s, the ‘exit’ optionhas been increasingly exercised in Argentina, mainly by those who had the means to escapeto the private education sector, in the search for higher quality. As can be observed in Figure3, although total enrolments (primary and secondary) increased between 1950 and 1980 forboth the private and the public sector (121%), the private sector’s participation did so in 11percentage points (from 9.6% to 20.6%). Enrolments in these schools more than tripledduring this period. Additionally, between the years 1980 and 1998, (years for which theChilean case has been described) such participation grew an additional 1.7% (increasingfrom a 20.6% of total enrolments to a 22.3%). Furthermore, while private school supplyincreased almost 60%, public school supply fell 5.2%.

However, looking at enrolments from a different perspective, a similar segmentation to

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FIG. 3. Evolution of school enrolments in Argentina , 1980–1998 (thousands).

that of Chile can be observed. Table IV presents enrolment by income level, type ofeducation and dependency for the coexisting reformed and non-reformed systems [14].Although private subsidised schools could not be traced trough the existing data forArgentina, religious private schools are differentiated [15]. Over two-thirds of the privateschools fall into this category. Similarly, 75% of private schools received some percentage ofsubsidies in 1998 (Morduchowicz et al., 1999). Therefore, it is not mistaken to assume thata large share of the existing subsidies are assigned to religious private schools.

As evidenced, the lowest quintiles have higher public education participation rates thanthe fourth and � fth quintile. Although the levels of education are mixed, combining reformedand non-reformed schools, it is evident that this occurs at all levels of education, but muchless markedly at the secondary and polymodal education level. While 86% of the lowestquintile enrolled in basic general education attends public schools, only 27% of thehighest quintile does so. That is, the probability of attending a public school for a child of thehighest quintile is about one-third of such probability for a child of the � rst quintile.

In terms of private schooling, the higher the quintile group, the higher the percentage ofchildren attending these types of schools. Moreover, this is much stronger for religious privateenrolment. While about 6% of the lowest income children in basic general education attenda non-religious private school, and 8% a religious one, 45% of the children in the highestquintile attend the former and 28% the latter. Such a pattern is the same for non-reformedprimary and secondary education, but not so clear for polymodal education (by 1997 thiseducation structure had been implemented in fewer than half of the provinces with a lot ofirregularities, and such stark differences in comparison to what happens in the rest of thelevels may be a consequence of this). Anyhow, the enrolment segmentation by schooldependency for the different income quintiles follows a similar pattern to that of Chile thatwas mentioned before.

There are not many studies with a similar focus to those mentioned for Chile thatapproach the Argentine case through an econometric methodology. The traced ones have

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TABLE IV. Population aged 0–24 enrolled by Income Level, Type of Education and Dependency, 1997

Income Quintile

Education level Dependency I II III IV V Total

Basic General Public 86.1 76.8 59.8 50.9 27.1 70.9

Education Religious Private 8.0 14.4 28.6 31.2 44.6 18.5

Non-religious Private 5.9 8.8 11.6 17.9 28.3 10.6

Total 100 100 100 100 100 100

Primary Public 95.3 85.8 76.4 67.9 51.4 85.4

(non reformed) Religious Private 3.8 10.4 16.1 24.8 32.2 10.6


Total 100 100 100 100 100 100

Polymodal Public 80.4 74.9 76.9 49.7 52.7 70.7

Religious Private 16.3 11.3 9.5 44.2 13.2 17.8


Total 100 100 100 100 100 100

Secondary Public 87.5 83.7 72.8 63.8 43.4 74.3

(non-reformed) Religious Private 6.8 10.5 20.4 20.6 34.7 16.1


Total 100 100 100 100 100 100

Source: Elaboration on the basis of the Encuesta de Desarrollo Social, SIEMPRO, 1997.

predominantly tried to identify public versus private sector differentials in education. Theresults obtained through regular Ordinary Least Squares (OLS) analysis (Table V) arede� nitely mixed—controlling for socio-economic characteristics of the children—with some-what better results for private schooling at least at the primary level (Llach et al., 1999), orfor Catholic private schools (McEwan, 2000a, b), or through a greater school autonomy inthe private sector (Eskeland & Filmer, 2000). Additionally, Llach et al. (1999) � nd that thehigher the socio-economic background, the higher the probability of choosing a privateschool, which further evidences the enrolment segmentation mentioned before.

Differing Governance Models

The consequence of the differing models of education provision of Argentina and Chile andthe differing decentralisation reforms that have taken place in these countries are two verydifferent sets of regulatory frameworks and education � nance and administration systems,that is, dissimilar forms of governance.

We developed a series of decision-making aspects in the areas of: policy planning, schoolsupply, school organisation, � nancing, personnel, curriculum and instruction, monitoringand evaluation, and student choice regulation—a total of 25 decision-making categories.From this categorisation (see Appendix I) the decision-making level for public and privatesubsidised schools was traced.

As observed in Figure 4, while in Argentina 88% of these decisions for public schools areeither taken by or have to have the input of provincial education authorities, in Chile,municipal governments are responsible for a larger amount of such decision-making (46%),but with an important supervision and control responsibility remaining at the central level(59%). Furthermore, for the private subsidised schools, the locus of governance changes in

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FIG. 4. Governance of public and private-subsidised schools in Argentina and Chile.

Note: C 5 Central level; P 5 Provincial level; M 5 Municipal level; S 5 School level. Source: own elaboration.

both cases towards greater school level decision-making, but this occurs much more markedlyin Chile. In Argentina, provincial authorities intervene in 42% of such decision-makingcategories for private-subsidised schools, and 58% of these have the school’s input. On theother hand in Chile, municipal governments intervene in only 4% and the school does so in63%.

Conclusions

The worldwide intent of improving administrative ef� ciency, school quality, and schoolequity in education has meant an important transformation of the national state’s role ineducation in favour of an increased role of lower government levels. Within the differentdirections that such policies have taken in the country-speci� c settings, some countries haveintroduced reforms with speci� c competition and ef� ciency components, as did Chile, whileothers have stayed in the decentralisation discourse with limited real changes having beenmade in this direction, as in Argentina.

Therefore, a transfer of authority from those in one location or level vis-a-vis educationalorganisations, to those in another level, has not necessarily changed the rules of the game forschools. On the one hand, Chile introduced strong decentralisation and market reformsduring the 1980s. Therefore, it evolved into a quasi-market model of education provision,

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where education is provided in a market system but where some aspects have been keptat the centralised decision-making level. On the other hand, Argentina can be de� ned asa quasi-monopoly system of education provision, since its education system is highlycentralised at the provincial level (being a federal country) but has an explicit andstate-subsidised exit option. Hence, these two countries have faced very different decentralis-ation reforms, which have taken place within two very different sets of regulatory frameworks.Notwithstanding, presently they have arrived at a similar situation in terms of the educationsystem’s enrolments’ socio-economic segmentation. In short, they represent two differentmodels of schooling provision and regulations that have arrived in the socio-economic aspectsat similar results.

Overall, the paper questions the causality governing the relation between the use ofcompetitive policies (vouchers) in education and an increased enrolment segmentation orstudent sorting. That is, it questions a predominant statement in the literature opposingcompetition initiatives in education, which indicates that such initiatives promote enrolmentsegmentation. Almost all of these approaches to the problem of socio-economic segregationhave to do with thinking of the relationship between vouchers and this kind of segmentationas a positive causality where the implementation of vouchers in education results in increasedsegmentation. However, the same results can also be found in systems such as the Argentineeducation system, which are highly centralised and have not introduced competitive reforms.Therefore, the evidence from Chile and Argentina shows that enrolment segmentation is nota consequence of the introduction of vouchers, and the causal relationship between these twovariables is broken. Even more, the equilibrium apparent in the Chilean experience wouldindicate the model’s success (Bravo et al., 1999) on the basis of competitive policies ineducation.

In conclusion, vouchers are not an independent variable but an intervening one withinthe determinants of socio-economic segmentation. The family school choice decisionsbrought about by the introduction of systems such as vouchers are de� nitely endogenous toa series of factors that determine such choice, factors that are evidently important in thedetermination of socio-economic enrolment segmentations in non voucher systems. Thisquestions the validity of empirical analyses that take student socio-economic characteristicsand school choice decisions as independent determinant variables of student results, highlypredominant in the empirical studies of competition policies.

NOTES

[1] For further de� nition of quasi-markets refer to Cullis and Jones (1998). They differentiate such markets in their

recognition that they are the result of a world trend for lower levels of public provision and higher market levels.

[2] We make reference to the concept of ‘Exit’ as developed by Hirschman (1969).

[3] The transference to the municipal level was temporarily suspended during 1983. In addition to this, the

economic crisis changed the rules of the game during these years since per student funding was initially indexed

and this was modi� ed, which brought municipal schools into a de� cit that brought about the central govern-

ment’s interventio n to cover these. Furthermore, so as not to reduce demand for municipal schooling a

modi� cation was introduced which limited private-subsidised school entry to the market. These market

distortions basically disappeared in 1986 (Panadeiros et al., 1998).

[4] The discount on resources to the schools is proportional to tuition fee increases. For a tuition fee of half the per

student subsidy, charged to parents, there is no discount on government funding; for tuition fee levels between

a half and a complete subsidy there is a 10% discount; for tuition fee levels between one and two per student

there is a 20% discount, and so on (Cox, 1997).

[5] Law 19.070 and Law 19.410.

[6] For further details of the reforms introduced in Chile during the 1990s, refer to Cox (1997).

[7] World Bank-� nanced (Latorre, 1997).

[8] Law 19.247 of 1993 established two alternatives to facilitate private resources in public education . These are:

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private donations (with tax bene� ts) and mixed funding. Municipal schools which opted for mixed funding

should still receive students who are not able to pay (Latorre, 1997).

[9] The establishment of an assessment system was a fundamenta l component of the reform. An assessment system

operated between 1982 and 1984, named PER (Prueba de Evaluacion del Rendimiento Escolar), but was

suspended. However, in 1988 the assessment reform component was reintroduce d and the SIMCE (Sistema deMedicion de la Calidad de la Educacion) was put into place, and has been operating ever since.

[10] Law 13.047 of September 22, 1947, known as Teacher Statute for Private Schooling Institutions (Estatuto parael personal docente de los establecimientos de ensenanza privada).

[11] Between 1953 and 1958 the con� ict between the Catholic Church and the government of Peron re� ected itself

in the education sector through a series of norms that took power away from the Church, the main private sector

schooling provider (Morduchowicz et al., 1999).

[12] Decree 15/1964.

[13] Law 24.195 of 1993: Ley Federal Educacion.

[14] The 1993 Federal Education Law changed the structure of the education levels from seven years of primary

education (presently the non-reformed primary schools) to nine years of basic general education (reformed

primary schools and the � rst two years of what used to constitute the secondary level), and the � ve years of

secondary education (presently the non-reformed secondary schools) into 3 years of polymodal education.

[15] The information is based on the Encuesta de Desarrollo Social, an urban household survey administered in 1997

by SIEMPRO (Sistema de Informacion, Monitoreo y Evaluacion de Programas Sociales), of the Ministry of Social

Development and Environment .

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Appendix I. Educational System’s Governance of Public and Subsidised PrivateSchools, by Administration Level

Argentina Chile

Decision-making by

category Central Provincial Municipal School Central Provincial Municipal School

GovernancePolicy planning X X X

Implementat ion X X X XSchool supply

Of� cial authorisation X Xa

School opening and closure P S P S

School organisationStructure P S P S

Min. requirements X XFinancing

Recurrent funding Xb X X

Capital funding P S P S

Compensatory funding X X X

School budget administration X S P S

Private funding Sc SdPersonnel

Hiring and � ring P Se P S

In-service training X P S X P S

Salary determinatio n P Sf Pg Sg

Quali� cation standards Xh X

Curriculum & instructionCurriculum content X X S X Xi

Textbooks decision-making P S P S

Textbook provision X P P S

Didactic methods P X P X

Student evaluation P X P X

Monitoring & evaluationMonitoring /supervision

Accreditation X X

Promotions X X

Discipline X X

Student/Schools assessment X X X

StudentsAdmissions P S Pj Sj

X 5 Public and Subsidised-Private schools; P 5 Public Schools, S 5 Subsidised-Private Schools.

Categorie s developed by the author and based on Rideout & Ural (1993).

(a) Authorisation is given by the National Ministry of Education with compliance to a set of requirements.

(b) Subsidies to private schools are only given to cover teacher salaries.

(c) Schools that are granted subsidy are done so at different percentage s on the basis of their organic personnel plant.

(d) Subsidised schools have been able to receive donations since 1993, as well as opt for mixed funding.

(e) The province of Jujuy however, establishes that private schools have the possibility of receiving � nancial support under

the condition that they comply with the provincial teacher statute in terms of job stability and labour conditions .

(f) As stated in the FLE, teachers in private institutions have the right to earn a minimum wage of at least as much as

teachers in the public sector.

(g) Limits imposed by the teacher statute.

(h) The requirement of the Federal Law of Education on teacher certi� cation is that it complies with each jurisdiction’s

requirements.

(i) Schools have to comply with study plans and programmes these being either the general ones dictated by the central

government, or their own after the National Ministry’s approval.

(j) Municipal schools are not allowed to select students , while subsidised schools do not have such a restriction.

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Documents

Socio-economic Segregation with (without) Competitive Education Policies. A Comparative Analysis of Argentina and Chile