Philadelphia School Privatization Revisited

A new study by Paul E. Peterson and Matthew M. Chingos of the John F. Kennedy School of Government at Harvard University offers the real story on the school privatization experiment in Philadelphia.

In 2002, the Philadelphia School Reform Commission contracted with the for-profit education management organization Edison Schools to manage 20 of the district’s under-performing schools, and with Victory Schools and Chancellor Beacon Academies to manage five each. The commission also contracted with and with nonprofit organizations to manage 16 schools: the University of Pennsylvania (5 schools), Temple University (5 schools), Foundations (3 schools), and Universal (3 schools). Since that time, the district has terminated several of the contracts and regained control of the schools. Do the terminations reflect the schools’ relative performance? The study by Paul Peterson and Matthew Chingos finds that they do not and concludes 1) for-profits outperform district-managed schools in math but not in reading; 2) nonprofits probably fall short of district schools in both reading and math instruction; and 3) for-profits outperform nonprofits in both subjects.

Philadelphia schools managed by for-profit companies outperform district-managed schools in math, and for-profits fare better in both reading and math when compared to schools under nonprofit management, according to new research by Paul E. Peterson and Matthew M. Chingos of the John F. Kennedy School of Government at Harvard University.

The Peterson-Chingos study, published in the peer-reviewed research section of the forthcoming issue of Education Next (Spring 2009), confirms that the effect of for-profit management of schools is positive relative to district schools, with math impacts being statistically significant. Over the last six years, students learned each year an average of 25 percent of a standard deviation more in math -- roughly 60 percent of a year’s worth of learning -- than they would have had the school been under district management. In reading, the estimated average annual impact of for-profit management is a positive 10 percent of a standard deviation -- approximately 36 percent of a year’s worth of reading. Only the math differences are statistically significant, however.