Do private schools force public schools to compete?

Since the 1980s, public policy analysts and sociologists of education have increasingly focused on differences in school performance between public and private schools, but ignored the effect on public school student performance of the wide variation among states in the size of the private school sector. I demonstrate that public school students in states with large private school sectors have improved educational outcomes. Contrary to assumptions underlying the school-choice movement, however; the improved performance of public school students is not the result of increased organizational efficiency, but instead is the product of increased resources provided to public schools. The state thus takes an active role in protecting public sector providers. Institutional forces of inertia are less salient predictors of organizational behavior than are dynamic political processes and public school resource dependency on state financial sources of support.