School Choice and the (Ir)Rational Parent

Abstract

No Child Left Behind aims to have every student in the United States achieve "proficiency" in reading, mathematics, and science by 2014. It aims to eliminate the achievement gaps in test performance between students of different races, ethnicities, and economic backgrounds. To reach these goals, NCLB relies on rational choice theory. One of its key tools is public school choice. When a school fails to make adequate yearly progress towards the goal of 100% proficiency, that school must offer its students the right to transfer to a higher-performing school. In using choice as a tool, NCLB's drafters adopted the notion that injecting market competition into public education will efficiently provide better schools for all. NCLB views parents as rational actors who will seek the best academic education for their children and, in doing so, will pressure schools to provide better education.

This article uses behavioral law and economics theory to examine the available empirical studies on how parents choose schools. Those studies undercut NCLB's premise that parents are rational actors when it comes to school selection. Instead, parental choice of schools is strongly influenced by implicit racial bias and by the parents' economic class, social networks and sources of information about schools. The article suggests that, as Congress considers reauthorization of NCLB, it attend to actual parent choice behavior and reconsider its use of school choice as a tool for achieving equity.

Keywords: school choice, heunstics, parental school choice behavior, prospect theory, No Child Left Behind, public education reform

JEL Classification: K19