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Does Competition Improve Teaching and Learning? Evidence from New Zealand

Central to the argument for more competition in education is that it will induce schools to provide higher quality education at no greater cost. This article sheds new light on this issue by measuring how competition among New Zealand’s schools affected student learning as perceived by teachers and principals. The analysis builds on the fact that New Zealand’s introduction of full parental choice in 1992 increased competitive pressures more for some schools than for others. With careful attention to various potential threats to validity, we conclude that competition—as perceived by teachers—generated negative effects on the quality of student learning and other aspects of schooling in New Zealand’s elementary schools.