Private education in history
England and Wales
Contrary to popular belief, the supply of schooling in Britain between 1800 and 1840 was relatively substantial prior to any government intervention, although it depended almost completely on private funds. At this time, moreover, the largest contributors to education revenues were working parents and the second largest was the Church. Of course, there was less education per child than today, just as there was less of everything else, because the national income was so much smaller. An estimated 1 percent of the net national income was spent on day-schooling of children of all ages in England in 1833. By 1920, when schooling had become "free" and compulsory by special statute, the proportion had fallen to 0.7 percent.
Working parents were purchasing increasing amounts of education for their children as their incomes were rising from 1818 onwards, before education was "free" and compulsory by statute. Compulsion came in 1880, and state schooling did not become free until 1891.
The author of the famous 1870 Act, W. E. Forster, explained that the intention of introducing fee-based government-run establishments for the first time was not to replace the vast system of private schools but simply to "fill up the gaps" where they could be found. His officials, however, were overambitious in their reports of these needs, and after government schools were erected they were often found to have much surplus capacity. To reduce their embarrassment over half-empty schools, the education boards then resorted to lowering tuition fees and using tax revenues to fill the breach. The lower price naturally expanded the demand; but this was at the expense of the private schools, many of which could not survive such unfair competition.
After education was made compulsory by statute, the government-school advocates argued that it was wrong to compel the very poorest to do something they could not afford. But rather than propose a special financial dispensation or grants to these families, the advocates insisted that education should be made free for all: the rich and the middle class as well as the lower-income groups. Free education was legislated for the new government schools exclusively because it was argued that it would be inviting conflict to ask taxpayers to subsidize religious schools. Protestant taxpayers, for instance, would object to their taxes financing Catholics, and vice versa.
In this way the new "gap-filling" government schools were given a wide-open field with their zero-priced education. Since most of the subsequent growing population naturally chose the free alternative, the private schools’ share of the market declined and that of government schools skyrocketed.
In the late 1830s, between two-thirds and three-quarters of the working classes were estimated to be literate. There was an appreciable rate of growth in literacy. An examination of educational attainments of males in the Navy and Marines in 1865 showed that 99 percent of the boys could read compared with their seniors: seamen (89 percent), marines (80 percent), and petty officers (94 percent). In 1880, when national compulsion was enacted, it is estimated over 95 percent of fifteen-year-olds were literate. For comparison, over a century later 40 percent of 21-year-olds in the United Kingdom admit to difficulties with writing and spelling.
According to widespread opinion, public schools would offer an inferior education, as indicated by Adam Smith in 1776: "Those parts of education, it is to be observed, for the teaching of which there are no public institutions, are generally the best taught". There was hardly any public funding of primary and secondary schools in England before 1830, and most funding was private as late as 1870. Yet during this period, the Industrial Revolution occurred; England became the world’s leading economic power; and literacy expanded dramatically. For example, from 1818 to 1834, for the most part a period of no public support, school enrollments rose from 478,000 to 1,294,000. Literacy is estimated to have reached 80 percent by 1870, the end of the era before government-sponsored public schools operated on a regular basis in England. Private education, much of it for profit, made England a nation of literate persons.
Henry Broughamʹs Select Committee reported (in 1820) that in 1818 about one in 17 of the total population of England and Wales was being schooled and paid for largely by working parents. Broughamʹs Committee reported that the figures for 1818 were a considerable improvement in 18 years on 1800 when the earliest estimate was made. Ten years later, in 1828, Brougham in his private capacity followed up the report for 1818 with a 5% sample survey of his own, using the same sources (the parochial clergy) as before. His findings suggested that the number of children in schools had doubled.
Whereas the actual growth of income per head in the years 1801-71 was slightly over 1% per annum, the average annual growth rate of day scholars was well over 2%. The growth of schooling in England and Wales during this period came before it was made free, compulsory and supplied by government. The annual growth of scholars also exceeded the annual growth of population. During the compilation of the 1851 educational census, it was reported that the average duration of attendance at school of working-class children was nearly five years.
The Newcastle Commission reported that by 1858 (seven years later), it had risen to nearly six years. And the attainment of an education threshold for most people was reported in the 1861 Commissionʹs conclusion that 'almost everyone receives some amount of schooling at some period or another'. It is true that government subsidies to schools were introduced in 1833, but their aggregate value was very low (only £20,000 in 1833). By 1841, they were still so small that they were considerably less than the private school fee revenue collected from parents in the City of Bristol alone.
The major 19th-century legislation came in 1870 with the Forster Act. Yet by 1869 most people in England and Wales were literate, most children were receiving a schooling and most parents, working class included, were paying fees for it.
In the U.S. state five commissioners were authorized in 1811 to report on the extent of education in the state. They acknowledged that schooling was indeed already widespread: "In populous cities, and the parts of the country thickly settled, schools are generally established by individual exertion. In these cases, the means of education are facilitated, as the expenses of schools are divided among a great many. It is in the remote and thinly populated parts of the State, where the inhabitants are scattered over a large extent, that education stands greatly in need of encouragement. The people here living far from each other, makes it difficult so to establish schools as to render them convenient or accessible to all. Every family therefore, must either educate its own children, or the children must forego the advantages of education."
Without discussing possible alternatives, the New York State commissioners recommended that the inconveniences could generally best be remedied "by the establishment of Common Schools, under the direction and patronage of the State." In place of discrimination in favor of the poor and thinly populated districts, a flat equality of treatment was decreed for all areas.
In the early legislation (of 1812 and 1814) there seems to have been no announced intention of making education free. Even with the addition of the revenues from town taxes there were far from sufficient monies to cover expenses. The substantial balance was presented in the form of rate bills (fees) to the parents, who were required to pay in proportion to the attendance of their children. For instance, in 1830 parental fees contributed $346,807 toward the total sum for teachers’ wages of $586,520.
The commissioners observed: "Morality and religion are the foundation of all that is truly great and good; and consequently, of primary importance." The Bible, in common schools, was to be treated as more than a literary work. The commissioners particularly recommended the practice of the New York Free Schools (the charitable establishments) in "presuming the religious regard which is due to the sacred writings."
Subsequently, the annual reports of the superintendents revealed a steady growth in the number of school districts organized. In some cases, entirely new schools were built; in others the personnel of existing private schools allowed themselves to become socialized, that is, to become common schools, in order to qualify for the public monies. In the report of 1821 it was stated that the whole number of children between the ages of five and 16 residing in the state was 380,000; and the total number, of all ages, taught during the year was 342,479. Thus, schooling in the early nineteenth century was already almost universal without being compulsory. Moreover, although it was subsidized, it was not free except to the very poor. The Superintendent’s Report of 1830 contained an account of a census of the schools of the city of New York for the year 1829. It showed that of the 24,952 children attending school in the city, the great majority, 18,945, were in private schools.
By this time the superintendents were expressing complete satisfaction with the provision of schooling. On the quantity of it the Report of 1836 asserted: "Under any view of the subject, it is reasonable to believe, that in the common schools, private schools and academies, the number of children actually receiving instruction is equal to the whole number between five and sixteen years of age."
The fact that education could continue to be universal without being free and compulsory seems to have been readily acknowledged. Where there were students who had poor parents, the trustees had authority to release them from the payment of fees entirely.
From 1650 to 1795, male literacy climbed from 60 to 90 percent; female literacy went from 30 to 45 percent. Between 1800 and 1840, literacy in the North rose from 75 percent to between 91 and 97 percent. And in the South during the same span, the rate grew from 50-60 percent to 81 percent. Indeed, Senator Edward M. Kennedy's office issued a paper not long ago stating that the literacy rate in Massachusetts has never been as high as it was before compulsory schooling was instituted. Before 1850, when Massachusetts became the first state in the United States to force children to go to school, literacy was at 98 percent. When Kennedy's office released the paper, it was 91 percent.
Private schools for the poor
According to a two-year in-depth study published in 2005 conducted in select low-income and slum areas in India, Ghana, Nigeria, and Kenya, private schools were more numerous than government schools and offer a higher quality of education to the children, while still being affordable for poor parents.
In the areas officially designated as "slums" of three zones of Hyderabad’s Old City, the researchers found 918 schools, of which only 35 percent were government schools, fewer than the 37 percent of unrecognized private schools. In total, 65 percent of schoolchildren in those low-income areas attended private unaided school. In the Ga District of Ghana (the low-income suburban and rural area surrounding the capital city of Accra) they investigated 779 schools in the same way, finding that only 25 percent were government schools and that 64 percent of schoolchildren attended private school.
In the "poor" areas of three local government districts (one rural, two urban) of Lagos State, Nigeria, were found 540 schools, of which 34 percent were government, and the largest proportion, 43 percent, were private unregistered. An estimated 75 percent of schoolchildren were enrolled in private schools. Including enrollment in private unregistered schools would reduce the percentage of out-of-school children in Lagos State from 50 to 26 percent.
Research was also conducted in the small shanty town of Makoko, in Mainland, Lagos State, and in the slum of Kibera, Nairobi, Kenya (reportedly the largest slum in sub-Saharan Africa). In both cases, the large majority of poor children attended private, not public, school.
The raw scores from student achievement tests showed considerably higher achievement in the private than in government schools. In Hyderabad, for instance, mean scores in mathematics were about 22 percentage points and 23 percentage points higher in private unrecognized and recognized schools, respectively, than in government schools. The advantage was even more pronounced for English. In all cases, this achievement advantage was obtained at between half and a quarter of the teacher salary costs.
The research indicated that a great success story was taking place, usually beneath the government’s radar. The mushrooming private schools, if noticed at all by the authorities and development experts, were assumed to be educationally inadequate. The research shows that this assumption was false.
A detailed census was conducted in 2012 in one Indian city, Patna. Among its 1.8 million people were 350,000 school aged children. According to official statistics Patna had only 350 schools, however, the census found that that were 1,574 schools. The missing schools were mostly unrecognized schools, charging very low fees and catering to the poor and lower middle class. Despite the apparently insignificant official numbers, in fact, private unaided schools made up the vast majority of schools in Patna – 78%, compared to only 21% of government schools and 1% of private aided. Classifying private unaided schools into three categories, based on their monthly fee levels, the analysis showed that 69% of private unaided schools were low cost, 22% affordable, and only 9% higher cost. That is, the vast majority of private unaided schools found in Patna Urban were low cost, charging fees less than Rs. 300/- per month. It was suggested that fully 65% of schoolchildren in Patna attend private unaided schools, with just 34% attending government schools.
In a random sample survey of households, nearly 70% of those with children in government schools would prefer to send their children to private unaided schools if they could afford to do so. More than half the respondents did not think the government schools provided quality education. In fact, about a fifth seemed to have chosen a government school only for non-educational benefits such as the free midday meal and uniforms. 
That private education can be supplied much more efficiently in the United States than state education is explained by Milton Friedman, who cites the example of St John Chrysostom’s school in one of the poorest neighbourhoods in New York’s Bronx. This school was voluntarily funded by a charity, the Catholic Church and the parents. Most of the parents were poor. The cost per pupil was far less than in state schools, yet on average the children were two grades above their state school peers. Friedman also describes the example of Harlem Prep, set up in the 1960s as a "store-front" school with the voluntary funds of concerned parents and teachers. Harlem Prep had poor physical facilities and inadequately qualified teachers by state school certification standards. Many of the pupils were former misfits and dropouts yet they excelled at this school, with many of them going on to leading colleges.
In Brazil operate several chains of private schools and universities. The largest is Objetivo/UNIP, with headquarters in São Paulo. Objetivo emerged in the early 1960s, when Mr João Carlos Di Genio started a coaching class for university entrance with about twenty private students. Finding considerable demand for his teaching methods, he founded an intensive cramming course in 1965 with three friends, for students to get into university. In 1967, they utilized internal television broadcasting for their lesson. Three years later they added a school, from primary to Second Grade, extended in 1974 to offer courses up to a university entrance. In 1988 they were granted the title of University for their upper levels - after what they saw as a fourteen-year struggle to get such recognition. Since then they have continued to expand, as of 2005 they have approximately 500,000 students in centres and franchises across Brazil, with annual turnover approximately US$400 million.
Picking only the best students
Students in private schools routinely outperform those in public schools both in the United States and around the world. But do private schools make students better or do they simply attract better students? Most studies find that private schools do attract better students. The question then becomes whether this "cream skimming" effect fully or only partially explains private school performance. In most places in the world there are many more children in public school than in private school. As a result, the private schools have a very large population of students to select from and it is easy to imagine that in one way or another the private schools select the cream of the students from the public schools.
However, in many districts in India a majority of students are in private schools. As the private share of school enrollment increases simple cream skimming becomes less plausible as the explanation for a higher rate of achievement in private schools. According to a study by Alexander Tabarrok, there is evidence for cream skimming when the private share is low and the private schools have a large pool from which to attract the cream. The private effect on achievement, however, does not appear to diminish greatly even in districts where 70% of students are in private schools.
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- Free Merriam-Webster Dictionary. "Private school", referenced 2012-04-10.
- Edwin West. "The Spread of Education Before Compulsion: Britain and America in the Nineteenth Century", The Freeman, July 1996. Referenced 2012-12-13.
- Richard K. Vedder and Joshua Hall. "For-Profit Schools Are Making a Comeback" (pdf), The Independent Review, v.VI, n.4, Spring 2002. Referenced 2012-12-13.
- E.G. West. "Education Without the State" (pdf), Economic Affairs, October 1994. Referenced 2012-12-13.
- Sheldon Richman. Separating School and State: Liberating America’s Families, The Future of Freedom Foundation, 1994, read excerpts online. Referenced 2012-12-13.
- James Tooley and Pauline Dixon. "Private Education is Good for the Poor: A Study of Private Schools Serving the Poor in Low-Income Countries" (summary, see full paper in HTML or PDF), Cato Institute, White Paper, December 7, 2005. Referenced 2012-04-24.
- Baladevan Rangaraju, Professor James Tooley, Dr Pauline Dixon. "The Private School Revolution in Bihar: Findings from a survey in Patna Urban" (online version; pdf), India Institute, E.G. West Centre, Newcastle University. 2012. Referenced 2012-06-02.
- Quoted from "Envisaging a Free Market in Education" (pdf) by Kevin McFarlane, Educational Notes No. 8, 1991. Quote refers to the Chapter 6 of the book Free to Choose (Penguin Books, Harmondsworth, 1980) by Milton Friedman. (Can be seen in video version here.) Referenced 2012-12-19.
- James Tooley. "Reclaiming Education" (Google eBook), Continuum International Publishing Group, April 2005, p. 104-105. Referenced 2012-12-10.
- Alexander Tabarrok. Private Education in India: A Novel Test of Cream Skimming (pdf), Contemporary Economic Policy, Volume 31, Issue 1, published 5 December 2011. See also Testing for Cream Skimming in India (video summary). Referenced 2013-02-18.
- Sean Coughlan. "View to a skill: The next big education player?", BBC News, 30 October 2013. Referenced 2013-11-07.
- Julie Bosman. "After 244 Years, Encyclopaedia Britannica Stops the Presses", New York Times, March 13, 2012.
- Education in Colonial America by Robert A. Peterson, September 1983
- ""Free" Education and Literacy" by Barry Dean Simpson, January 2004
- Private Schools in the Poorest Countries (pdf) by James Tooley, September/October 2005
- Backing the Wrong Horse: How Private Schools Are Good for the Poor by James Tooley, May 2006
- How Private Schools Are Serving the Poorest (video) by Pauline Dixon, April 2012
- School's Out (video), BBC Newsnight, June 2005
- The Beautiful Tree: A Personal Journey Into How the World’s Poorest People Are Educating Themselves (complete book) by James Tooley, 2009
- The Underground History of American Education by John Taylor Gatto, 2003
- "Laissez-Faire Learning" by David Greenwald, June 2012
- Education and the State by E.G. West (a collection of writings about the topic)
- The Lost Elementary Schools of Victorian England: The People's Education (partial preview) by Phil Gardner, 1984
- "Academic Secession" by John H. Moore, November 1998
- Access to Achievement: Opening up good schools for all (pdf) by Chris Lambert, 2002
- Can the Free Market Provide Public Education? by Sheldon Richman, June 2000
- Competition in Education: The Case of Reading by Daniel Hager, April 1997
- Educational Freedom by Scott W. Bixler, August 1975
- Too Important for a Government Monopoly by John Stossel, 2010
- Freedom of Education Will Solve Our Education Crisis Jack D. Douglas, June 1992
- A Free-Market University by William H. Peterson, April 1994
- The Rise of Private Education in India (video) with Alex Tabarrok
- What if students learn faster without teachers? by Richard Galant, March 2013
- How a Radical New Teaching Method Could Unleash a Generation of Geniuses by Joshua Davis, October 2013
- Small, New University Does Something Radical -- Only Hires Professors Who Want To Teach And Only Admits Students Who Want To Learn George Leef, January 2014
- How Private Schools Are Educating the World's Poor (video/audio) with Tom Woods and James Tooley, September 2014
- For the Kids — and for Profit by Howard Baetjer Jr., April 2015
- Prof James Tooley - 'The profit motive in education' (video) with James Tooley, October 2011
- Universities Face Increased Pressure from Job Programs That Generate Results, Not Just Debt by Zak Slayback, January 2019
- Private school at Wikipedia