Does competition from private schools improve public schools? Advocates of school choice have long argued that it does. Public schools without such competition, they maintain, become lazy monopolists. In the case of competition from charter schools and private schools funded with vouchers, research indicates mixed effects. In the case of competition from private schools alone, with no government subsidies, research indicates negative effects.

In keeping with the argument made by Albert O. Hirschman in Exit, Voice, and Loyalty (1970), private schools in this latter context draw parents of means away from public schools and in the process deprive public schools of the influence these parents often exercise to boost teacher salaries, keep class sizes down, and properly fund science labs, music programs, and the like. Districts with and without a significant presence of private schools confirm this pattern. The same holds for nations as a whole.

The fundamental factor behind the celebrated excellence of schools in Finland, in this regard, may well be the virtually nonexistent opportunity for exit. Apart from a handful of private schools—almost all of which are publicly funded and must admit students on a first-come basis and abide by national curricula—there are no alternatives for the children of doctors, lawyers, bankers, and corporate executives. The public system accordingly benefits from nearly universal involvement.

In “Constraints on Public Schools from Instituting Changes to Compete with Private Schools: Evidence from Nepal,” Priyadarshani Joshi addresses this question about the impact of competition from private schools on public schools for a nation where there are public schools and private schools. That is all. There are no charter schools or publicly funded private schools, via vouchers or direct subsidies.

Joshi, a senior research officer with UNESCO’s Global Education Monitoring Report, finds that the flight of middle- and upper-income families to private schools in Nepal indeed goes a long way in explaining the failure of public schools to measure up. Parental engagement and community support, in particular, fall short. Public schools, as a result, lack necessary funding, struggle to recruit and retain qualified teachers, and suffer from inadequate government oversight.

Employing a mixed-methods approach, Joshi draws her conclusions from, one, a survey completed by principals at all public secondary schools and a sample of private secondary schools in Kathmandu and Chitwan, the first and third largest districts in Nepal, respectively; and from, two, a collection of 80 interviews conducted with teachers, principals, school board members, and government education officials. To address the key constraints faced by public schools, Joshi coded all interviews for stakeholder perspectives. To measure how perceptions vary by degree of competition, Joshi quantitatively assessed key views of principals about barriers to reform.

Rigorous, innovative, and lucid, this working paper fills a void in the literature on school choice. While there is abundant empirical analysis of the impact of choice policies on public schools in such countries as Chile, England, Sweden, and the United States, there is little such analysis in developing countries like Nepal. With five tables and copious citations, Joshi provides ample evidence and documentation for her findings and paves the way for further investigation.

Samuel E. Abrams
Director, NCSPE
January 9, 2023