This IEA Discussion Paper looks at the role of for-profit schools in Sweden and for the first time provides quantitative evidence regarding how these schools perform. The competition that drove improvements in the Swedish system was only possible because of the high number of for-profit schools that were established.
This research clearly shows that:
- Under a system where profit is allowed more children have access to schools that will improve their educational achievement.
- For-profit schools make the competition that drives up standards possible by increasing the supply of new schools.
- Importantly the impact of for-profit schools tends to be greatest on those from low socio-economic backgrounds.
The educational outcomes of children going to for-profit and not-for-profit schools were significantly better than those of children going to state schools (measured in terms of average school GPA, which measures pupil achievement across a broad range of subjects).
Not-for-profit schools did marginally better on average than for-profit schools (raising the GPA by 5.7 points compared with the for-profit schools’ impact of 4.5 points), but among schools with pupils from lower socio-economic backgrounds, for-profit schools performed better (increasing the GPA by 11.6 points).</