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Research Update
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Number 1, 2008
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Microeconomics
 
No. 315, January 2008
Impact of Voucher Design on Public School Performance: Evidence from Florida and Milwaukee Voucher Programs
Rajashri Chakrabarti
This paper examines the impact of vouchers and voucher design on public school performance. The 1990 Milwaukee experiment can be viewed as a “voucher shock” program that suddenly made low-income students eligible for vouchers. The 1999 Florida program can be viewed as a “threat of voucher” program, in which schools getting an “F” grade for the first time are exposed to the threat of vouchers, but do not face vouchers unless and until they get a second “F” within the next three years. In the context of a theoretical model, the study argues that the threatened public schools will unambiguously improve under the Florida-type program, and this improvement will exceed that achieved under the Milwaukee-type program. It then shows that these findings are validated empirically.