Making a Good Public Does Not Make It a Public Good

18 Oct, 2012

In a recently published op-ed, “If Education Is Not a Public Good, What Is?,” Christopher Bangs argues that education is a public good based on an inaccurate interpretation of the conditions required for a product to be classified as such. He then goes on to claim that “education at all levels truly is a right, because it truly is a public good.” However, a careful look at the characteristics of a public good inevitably leads to the conclusion that education is not part of this group. Moreover, whether a product is a public or a private good has no bearing on whether we as a society regard it as a right of all citizens, and this in turn does not necessarily imply that it must be provided free of charge.

The term ‘public good’ is used by economists to describe commodities for which private provision will either be non-existent or inefficient – none or too little of it will be provided, even though there is considerable demand for it. This ‘market failure’ arises from the fact that the commodity satisfies the following two conditions: 1) non-excludability, meaning it is either impossible or prohibitively costly to exclude individuals from consumption of the good once it is provided; 2) non-rivalry, meaning consumption of an additional unit of the good has a marginal cost of zero.

A typical example of a public good – mentioned by Mr. Bangs – is national defense. Once provided, it is technically very difficult and extremely costly to exclude some individuals from protection against external threats. Regardless of whether they paid for the service or not, all individuals within the country are benefiting from it. Furthermore, the marginal cost of protecting an additional person is zero or very close to zero – for instance, whether a country has a population of four or six million is of little consequence for the number of soldiers needed to patrol its border. Thus, national defense is a ‘pure public good’ in the sense that  its consumption is both non-excludable and non-rival.

Let us now turn to education. Is it technically impossible or prohibitively costly to exclude people from its consumption? Not really. Students can be prevented from entering the classroom, or a password can be required for individuals to be able to access lectures online. Is consumption of education non-rivaly, or in other words, does an additional student add no extra cost to its provision? This would mean that all schools in Canada would require the same annual budget and number of faculty, regardless of how many students attended each. This is certainly not the case, and it is why education budgets have to be periodically adjusted to account for population growth if quality is to be maintained.

If education were a public good, private provision of it would either be lacking or limited to exceptional situations. This is hardly the case in the real world, where scores of private schools are springing up to satisfy the demand from those who can afford it and are disappointed by the recent decline in public education. In an effort to lower costs and improve quality, governments themselves are increasingly turning over provision of mandatory education to private providers, either by paying them directly or by giving vouchers for taxpayers to use. The latter approach was pioneered by economist Milton Friedman, and it has been applied for years in charter schools run by the University of Chicago with enormous success, furnishing pupils – mostly from minority and low-income backgrounds – with the skills they need to better their situation, something which few public schools in the city can boast about (click here for a report by The Economist on the performance of charter schools in the United States).

Therefore, both an application of economic theory on public goods and a look at the real world leads to the conclusion that education is not one such commodity. Contrary to Mr. Bangs’ assertion, the fact that education clearly is a private good need not preclude us a society from regarding it as a fundamental right, particularly at the primary and secondary levels. As a matter of fact, knowing it is not a public good helps us better understand what is needed to provide high-quality education that is accessible to all. This does not mean that all education should be provided free of charge. Many people believe that, while access to education is a right, those who can afford to do so should pay their fair share, and government resources ought to be focused on the most vulnerable so that genuine equality of opportunity is achieved.

A public good, a right, and free-of-charge provision are not synonymous – quite far from it. Conflating them only clouds our perspective on how best to confront the challenges we face as a society and how to apply the principles we hold dear. Its consequences for Québec came to a boil this spring, and they continue to poison the debate on educational policy.


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