Author Archive

Why do we have such high-stakes exams for students?

July 6, 2015 Leave a comment

Simon Burgess

A report published on Saturday 4th July raised serious concerns about pupils developing stress-related conditions linked to taking high-stakes tests. It was reported that “The National Union of Teachers’ report says … most teachers surveyed for the report agreed pupils became “very stressed/anxious in the time leading up to Sats/public examinations”.”

Obviously, reports of mental illness and stress amongst pupils are very concerning and need to be taken seriously.

There are two things here – the nature of the school accountability system and the nature of the tests that school children take. I have talked about school accountability before on this blog, and there is very good evidence that when Wales abolished school league tables, pupil attainment fell dramatically. That is not the topic here.

The tests that pupils take in England at age 16 are very high-stakes. Does this have to be the case? Are there alternatives? Why do we make kids sit these high-stakes high-pressure exams at 16?

I think that there are two main alternatives: use teacher assessments, or just have no exams and no marks and each pupil simply leaves with a certificate confirming that they have completed a certain number of years of schooling.

Teacher Assessments

What about teacher assessments? They would be based on a full year’s work and would be capable of giving a rounded view of each child’s capabilities. There are, however, three big objections.

The first objection is simply pragmatic: workload. At a time when teachers responded in such force to the Secretary of State’s enquiry about workload and over-stretch, adding another substantial and complex item would be impossible. It’s true of course that teachers provide assessments for their pupils now, but this would have to be a very different thing if it summed up a child’s time in school and was the only thing they left with.

Second, imagine the pressure that teachers would come under. Their personal assessment of your child’s maths ability might make all the difference to her getting into Cambridge – you’re not going to talk to the teacher? It would make the key parent-teacher relationship very fraught. And we can hardly ban parents from talking to teachers.

Third, there are two sources of bias in teacher assessments, both very clear in the data. There is centrality bias: teacher assessments of children’s performances are much more tightly clustered around the middle than are remotely-marked tests. For example, looking at Keystage 2 tests, the variance in test scores is around 20% higher than the variance in teacher assessments in English and maths. This happens in all jobs where people are evaluated, but particularly in ones where there is an on-going personal relationship. Second, there are gender, ethnic and social biases that seem to arise from stereo-typing, which we evidenced here and discussed more recently here. These arise simply because teachers – like everyone else – unconsciously use stereotypes to form judgements. There is evidence for this in England’s schools from us here and from IOE here. There has to be a way for children to shine, regardless of what their teacher might think of them.

Leaving Certificates

If using teacher assessments is out, what about just having a leaving certificate, no exams, no marks?

The reality is that in life beyond school, people will still need to be able to differentiate between candidates with different abilities. And to differentiate both types of ability – languages, maths, art, sports – as well as levels of ability. If all pupils left school with the same certificate, perhaps just differentiated by completed years of schooling, then firms and universities and other organisations would have to do the differentiating themselves. They would all have to run their own tests (or subcontract them).

This would be much worse than the present situation. There would potentially be very many tests. Perhaps with every job interview and every university application everyone would have to take tests in English, maths, language, science, … And the job would hang directly on the test, rather than slightly indirectly now. This would be much less efficient, much less fair and much less meritocratic.

Less meritocratic because there would be considerable scope for favouritism in each organisation.

Less fair because, removed from the impartial bureaucracy of the school exam system, there would be greater scope for extra help, cheating and non-neutral marking.

Less efficient because having (essentially) the same exams for everyone at the same time, marked at the same time and to the same standard is an incredibly efficient way of distinguishing different levels of ability. Without these, the testing and differentiating of abilities would be fragmented, cumbersome and very variable.

These local, amateur, idiosyncratic tests would reduce productivity by reducing economic (allocative) efficiency: the wrong people would be in the wrong jobs and courses, and would spend a lot of time working their way back to the right ones.

And finally, if everyone’s school days did culminate in just an ungraded leaving certificate, it is hard to believe that there would be as much motivation for pupils to try hard at school. The love of learning cannot take you all the way and if you get the same certificate for working on your homework as you get for watching TV, then it’s likely that less learning will get done.

This is obviously not at all to say that our current exam system is perfect; far from it. But one can imagine, if we were in that highly inefficient world of very many independent bespoke tests, that it would evolve to something like we have now.

Compared with the alternatives, our system of high-stakes exams is more meritocratic and more efficient and, in the end, probably less stressful than any alternatives. This is of course not to say that there might be valuable ways of making the experience less stressful.

Categories: Uncategorized

Schools and Inequality, Part 253

June 4, 2015 Leave a comment

Simon Burgess

Recent debates about inequality have been dominated by discussion of pay at the very top of the income distribution. Whilst this is undoubtedly important, we surely also need to be concerned about the earnings gap between the middle and the bottom, and between the bottom and the very bottom.

This is where education comes in. How can school reform reduce earnings inequality? For all that special factors do matter, earnings are hugely affected by qualifications, and so the chances for pupils to get good qualifications matter for earnings inequality.  The earnings penalty for not getting at least 5 good grades at GCSE is estimated to be over 25%.

There are obviously a lot of facets to this, many of which have been discussed previously in this blog.

A key issue is your chance of getting into a high-performing school, bringing school admissions to centre stage. A report last week from the BBC’s Sean Coughlan  discusses an innovative admissions policy from a new academy in Birmingham.

Innovation is surely needed.

At the moment we decide the question of who gets into high-performing schools by working out who lives nearest. Unsurprisingly, the housing market reflects this advantage in substantial premia for houses close enough to guarantee entry to the most popular schools. And as reported here, estate agents are providing ever more, and more localised, information on nearby schools.

We showed here (scientific paper) and here (blog) that this schools’ admission policy has a major effect on pupils’ chances of getting into a top school. We showed that the gap in average school quality between the richest and poorest fifth of families increases by over 30% when factoring in the probability of admission based on proximity to the school.

If we want to do something to reduce inequality and to raise social mobility, one place to start is to even up the chances of attending the best schools.

Maybe we should just abandon the proximity criterion altogether? There are pros and cons to the idea of having tight local catchment areas around schools. The major con is as just mentioned, it has a very regressive impact. The pros are that it can generate a sense of neighbourhood – kids can play together, study together and form friendships. The Mayor of Boston explains clearly the downside of having more fragmented school catchment areas: “Pick any street. A dozen children probably attend a dozen different schools. Parents might not know each other; children might not play together. They can’t carpool, or study for the same tests.”

So it’s not an easy problem.

The school in Birmingham, University of Birmingham School, has a very interesting solution to this problem: “It is basing its admissions for 11-year-olds on how close families live to four “nodes” across the city. After siblings and looked-after children, half the intake will be based on closeness to the school, with the other half of pupils shared between closeness to the other three points on the map.” The idea is explicitly to try to secure a diverse intake to the school, “mixed in terms of socio-economics, ethnicity and academic ability.”

Mossbourne has a different approach to the same aim, combining ability banding and geographical rings round the school. Whilst living very close to the school helps, the school reserves places for those living further away.

In essence, both of these solutions are like this: reserve a fraction of places for ‘local’ children; the remainder of school places are open to anyone and if those are over-subscribed, use something other than distance as a tie-breaker, such as random draw.

The policy question is: what is the optimal fraction to reserve for those living further away? 25%? 50%? Research to be done, but its surely not 0%.

One way to make progress is to study what happens in practice when schools innovate.

More, please.

Categories: Uncategorized

A tale of two taxes

March 3, 2014 1 comment

Author: Mike Peacey

It was the best of times. The UK economy was booming and mortgages could be taken out with a LTV of 125%. It was the worst of times. The house price bubble had burst and inaugurated the worst financial crisis since 1929.

Fast forward five years and astonishingly the best of times seem to be coming back. Asset price inflation in the housing market is once again hitting the headlines. It’s no surprise that people want to get on the housing ladder after seeing how well their parents have done. The expectation that house prices will rise faster than other assets has been vindicated by decades of experience.

Many people hoped that the experience of the financial crisis might change these expectations, but recent events suggest this is wrong. Asset price bubbles present policy makers with politically difficult choices – particularly in the conduct of monetary policy.

Notoriously, the advantageous tax treatment of housing contributes to these problems. Today the most important advantage homeowners enjoy is private residence relief (PRR). In contrast to other assets, where capital gains are taxed, PPR exempts the payment of capital gains tax (CGT) on our homes.

This gives homeowners an unfair advantage over those with most other assets, and encourages asset price inflation – as one is willing to spend more on assets with such tax relief. Written by a youngster this blog post might just seem like a selfish way to buy a cheap house. The experienced forty-something shakes her head explaining “although I made £50k when I sold my flat, I needed this money to move up the ladder.” Removing the PRR exemption would mean less money to put towards her next property – but her next property would most likely be cheaper!

The losers from the elimination of CGT exemption will be “Last-time sellers” (LTS) – in practice the baby boomers. For future generations, the tax payments they make when they sell will be offset by lower house prices when they buy. The result is the necessary wealth transfer from the current baby boomers to the increasingly indebted youth. Moreover, the introduction of what would amount to a kind of Tobin tax should ensure the problem is never repeated.

The conventional wisdom is that the exemption of homes from the current system of CGT is politically impossible to reverse. However, the elimination of MIRAS (Mortgage Interest Reduction at Source), and the recent tightening of the rules in the coalition’s autumn statement (i.e. on 2nd homes and foreign owners), demonstrate that tax reform in the field of housing is possible.

Housing is not entirely exempt from taxation. Stamp Duty Land Tax (SDLT) is the transaction tax which is payable on the purchase of property. The infamous feature of SDLT is that the marginal tax rate will exceed 100% every time the price crosses one of the thresholds, because a single tax rate applies to the whole transaction. If CGT on housing is unacceptable to public opinion, SDLT is equally unpopular with economists (e.g. here, here, here, here, etc!). If it is accepted that an explicit extension of CGT to housing is politically impossible, perhaps SDLT could be reformed to incorporate an element of capital gains taxation whilst removing the distortions so disliked by economists.

This reform I am proposing would incorporate two elements, which together imply that the notorious ‘cliff edge’ would be removed.

The first change is that the tax would be paid by sellers rather than buyers. As every first year student knows this change should make no difference – since who pays the tax will depend of the relative willingness of buyers and sellers. However, it is not widely understood that, when buyer and seller bargain over the house price, the presence of a cliff edge tax means that this result does not hold. These cliff edges have been shown to suppress prices, so badly chosen alterations could increase house prices.

The second change is that the tax paid would be paid at a constant rate, which would depend on the seller’s capital gain. The cliff edge property would be removed (since any increase in the sale price would have a constant effect) and the rate at which these capital gains would be taxed could be very different from other assets.

In contrast to the current system the tax is only paid by the lucky winners, with those experiencing the largest gains paying the most. The proposal that the new tax should be paid by the seller has one further advantage. It will be much harder for the seller to “pass on the tax” by charging a higher price, than with a more conventional sales tax. This is because similar houses must sell for the same price – but the capital gain will be unique to the seller.

Finally, the principal should be established from the beginning that the treasury can change the rate in response to house price inflation. 


Price competition to be (re)introduced in the NHS

January 8, 2011 Leave a comment

Carol Propper

The Government has announced is to permit hospitals to compete on price. This dramatic shift towards a more commercial market in the NHS is announced in a single paragraph in the NHS Operating Framework for 2011-12 published last week.  Paragraph 5.43 says: “One new flexibility being introduced in 2011-12 is the opportunity for providers to offer services to commissioners at less than the published mandatory tariff price, where both commissioner and provider agree.”  It adds: “Commissioners will want to be sure that there is no detrimental impact on quality, choice or competition as a result of any such agreement.”

This problem with this innocuous sounding paragraph is that we have been here before and it doesn’t work.  The reason is that in health care, prices are easy to observe, whilst quality is not.  In these circumstances, health care commissioners and sellers, despite the hopes of the Operating Framework, end up focusing on price, raising the prospect of two-for-one deals on surgery and cut-rate consultations for certain specialties. At the same time, in order to provide services at these prices, quality suffers.

Research from CMPO showed this is precisely what happened in the internal market of the 1990s, where price competition was allowed.  Hospitals facing more competition focused on bringing down costs and lowering waiting list in order to provide what their commissioners wanted. But this was at the expense of quality and the consequence was that patients in hospitals located in competitive markets were more likely to die after an admission following a heart attack. These kind of unforeseen consequences are ikely to happen again – especially now when budgets are tight.

In making this move, Andrew Lansley is ignoring all the evidence on the impact of price competition in the hospital sector and is potentially endangering patients lives.