Do Charter Schools Crowd Out Private School Enrollment?

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Evidence from Michigan


Charter schools have been one of the most important dimensions of recent school reform measures in the United States. Currently, there are more than 5,000 charter schools spread across the 40 U.S. states and the District of Columbia. Though there have been numerous studies on the effects of charter schools, these have mostly been confined to analyzing their effects on student achievement, student demographic composition, parental satisfaction and the competitive effects on regular public schools.

This study departs from the existing literature by investigating the effect of charter schools on enrollment in private schools. To investigate this issue empirically, the authors focus on the state of Michigan where there was a significant spread of charter schools in the nineties. Using data on private school enrollment from biennial NCES private school surveys, and using a fixed effects as well as instrumental variables strategy that exploits exogenous variation from Michigan charter law, the authors investigate the effect of charter school penetration on private school enrollment.

The author find robust evidence of a decline in enrollment in private schools,—but the effect is only modest in size. We do not find evidence that enrollments in Catholic or other religious schools suffered more relative to those in non-religious private schools.

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