The Visible Hand: Markets, Politics, and Regulation in Post-Katrina New Orleans

• In Event: 75.061 - Roundtable Session 34
  In Roundtable Session: 75.061-11 - Education Markets and Social Inequalities: A Global Perspective

Abstract

Purpose. Despite attempts to diminish the role of government in public schools by introducing market-based reforms, such as school choice and competition, markets in public education are often the direct result of policy enacted by government institutions. Districts also construct and intervene in education markets in multiple ways, setting the ground rules for choice and student assignment, and determining the number and types of schools. While previous research has highlighted the mechanisms of market competition, focusing on the so-called “invisible hand,” this paper argues that all markets, but especially those in education, are governed also by a visible hand that influences how they operate. This paper examines how the regulatory environment in New Orleans influenced choice, incentives, and competition among schools. Comparing two governing agencies, I examine how the different policy environments influenced school leaders’ perceptions of competition and their behavioral responses to it.

Theoretical Perspective. While neoclassical economics minimizes the role of government institutions in the marketplace, a political-economic approach highlights the different ways that districts shape education markets and the implications for school leaders, students, and communities. Government institutions underpin market society (Polanyi, 1944). Competition between schools is shaped not only by social and economic forces, but also by political relationships, local government institutions, and district regulations (Feigenbaum et al., 1998; Fligstein, 2001). This study adopts a political-economic approach, viewing ‘markets as politics’ and moves beyond “sterile debates” about how much states should intervene in markets to “arguments about different kinds of involvement and their effects” (Evans, 1995, p. 10).

Method and Data Sources. I analyzed qualitative data from both “districts” overseeing New Orleans schools, the locally elected Orleans Parish School Board and the state-run Recovery School District. I conducted interviews with 30 local school leaders, 10 district leaders, 3 state-level policymakers, 8 charter-network leaders, and 2 intermediary organization leaders. I collected board minutes and news articles to inform my understanding of the local political context. Interviews and board minutes were coded in a way informed by the literature.

Results. Schools’ political contexts affected school leaders’ perceptions in relation to competition and their capacities to respond to competitive pressures. In particular, policies such as the common enrollment application, facilities, and transportation mediated schools’ experiences in the market and had the potential to shift their overall market position. In addition, governing agencies’ policies constrained or enabled school leaders’ ability to respond to competition, sometimes mitigating and other times exacerbating inequities in the marketplace.

Significance. Districts play an important role, even in market-oriented sites like New Orleans, to ensure equity, quality, and mitigate negative externalities. An exclusive focus on market mechanisms ignores these factors. My research suggests a need for greater understanding of the continued and refocused role of the state and other actors, such as foundations and intermediary organizations, serving in policymaking roles (Author, 2014), in mediating the contexts within which market reforms take place. My findings contribute to our understanding of how district policies shape economic behavior and have implications for district leaders in reform districts.

Author

• Huriya Jabbar, The University of Texas - Austin