NCPA - National Center for Policy Analysis

Charter Schools in North Carolina

March 11, 2004

Proponents of school choice argue that charter schools improve the quality of education. Opponents retort that they just waste education dollars. A new report from the National Bureau of Economic Research finds that charter schools did improve school quality in North Carolina.

In 1996, North Carolina had no charter schools. By 2000, it had 91 charter schools that enrolled 14,899 students, about 1 percent of the state's total public school enrollment. To determine whether these charter schools accomplished anything, the authors used end of year test scores for grades three through eight from North Carolina's statewide testing program. They found:

  • Charter school competition raised the composite test scores in district schools, even though the students leaving district schools for the charters tended to have above average test scores.
  • The gain was relatively large, roughly two to five times greater than the gain from decreasing the student-faculty ratio by 1, and a gain of more than 0.75 percent in 1999-2000.

For comparison, the authors point out that the North Carolina Governor's Office proposed increasing achievement by reducing average class size by 1.8 students at a cost of $26 million in 2002. The data suggest that this would produce just one-third of the test score increase created by opening a neighboring charter school, a move that would not require any additional spending.

Source: Linda Gorman, "Does School Choice Increase School Quality?" National Bureau of Economic Research, NBER Digest, January 2004; based upon, George Holmes, Jeff DeSimone and Nicolas Rupp, "Does School Choice Increase School Quality?" National Bureau of Research, Working Paper No. 9683, May 2003.

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