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Bulletin Archive > #267 April 2002 - Independent Schools and the Free Market

BULLETIN #267 APRIL 2002

Independent Schools and the Free Market

Essentially, independent schools in America can do anything they want within the norms of ethical human conduct. They may discriminate in innumerable ways, e.g. academically, religiously, socially, behaviorally, so long as they do not violate public policy. They may choose to educate boys or girls only. They may recruit athletes, xylophone players or rising Michelangelos to their heart’s content. They may offer the strictest, most traditional curriculum, or as with an alternative school in New England, let the students decide each day what they feel like doing. They are in theory, and often in practice, exemplars of the free market in education.

The idea of the free market in this case, is that the best service wins, or more generously, the best services win. In its pleasantest form, most Americans like the free market. Its darker side, of course, is another issue. Freedom to do or be what they want for independent schools (other than legal curbs) is restrained by only two external forces, the satisfaction of customers and peer pressure. The first is obvious and is at the core of our success. Independent schools have to produce the educational quality and style that their customers demand or they go out of business. It’s an ancient formula called direct accountability to the consumer. The second, peer pressure, is more subtle, less powerful, but still a force to be reckoned with.

Peer pressure is strongest among independent schools where there are large aggregations in and around cities. To stop what some consider predatory practices, agreements (a type of treaty) are reached in admissions including common reply dates, limits on recruiting, and respect for signed enrollment contracts. Understandings about hiring are also observed including restrictions on poaching, proper notification and open communication. In some cases, attempts are made to curb recruitment of athletes to avoid the interscholastic absurdity of one school being overwhelmingly dominant in a specific sport. Taken together, such practices prevent jungle warfare, and the penalty for the nonconformist is ostracism.

But what if independent schools, within societal limits, engaged, as it were, in an unrestrained Adam Smith play? The free market purists contend that ultimately students and families would be best served. Schools would struggle prodigiously to meet customer needs; to eliminate outdated programs, to manage efficiently and to resist educational inertia. The strongest, best-run schools in their sphere would survive and flourish. Others that could not compete in the marketplace would expire, leading, the purists say, to overall higher quality. Endless commercial parallels could be cited, from the impact of the Japanese on the American automobile industry to the triumph of U.S. technology in the world marketplace. But as with all pure plays, there are downsides that usually have to do with issues of humaneness, non-violence and the survival, not of the institutions themselves, but of the people who compose them.

The actuality of the independent school world is that the free market system generally prevails with a few but important constraints. First, the state requires certain minimum standards, largely in the realms of health and safety. Public policy also forbids racial and ethnic discrimination and several other practices in matters of employment. Bullies in the marketplace are held in check either by local compacts or codes of good behavior promulgated by state and national associations. The accrediting process, to which most schools adhere, too can modify the conduct of market mavericks. But otherwise, though some might last longer than in a totally free market, independent schools have to perform to survive, and certainly to flourish. Among NYSAIS members alone, fourteen schools have either closed or merged since 1988 while at least an equal number have started up or come of age. For those that left the scene, it’s a sad story, but for the enterprise of private education, there is indisputably a healthy form of Darwinism at work.


Diversity Conference Opening Dinner

TIAA-CREF, NYC

25 April, 2002

Diversity Conference

TIAA-CREF, NYC

26 April, 2002

Athletic Directors Conference

Mohonk Mountain House

28-30 April, 2002

Admissions Directors Conference

Mohonk Mountain House

1-3 May, 2002

NYSAIS/CAIS Business Affairs Conference

Mohonk Mountain House

1-3 May, 2002

Contact Barbara Swanson for further information.

( (615) 297-7859 email: barbara@nysais.org

Contact Jeanne Ryan to register.

( (518) 346-5662 email: jeanne@nysais.org


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