Education and the State: A Study in Political Economy, Third Edition, Revised and Expanded

Is State Education a Necessary Institution?

MAY 01, 1995 by JULIO H. COLE

Filed Under : Education

E.G. West’s Education and the State is an important book on an important subject. Liberty Fund has performed a valuable service in sponsoring the expanded third edition of this well known analysis of the economics of state education. Indeed, though West’s masterful and no-nonsense study has long been an acknowledged classic in its field, it has nonetheless been out of print for quite some time–too long, I should say, given the continuing topicality of its theme.

No one ever seems to be completely satisfied with the quality of education at any given time. Perhaps that is in the nature of things. Too often, however, the temptation arises to invoke state intervention in the educational market in order to improve matters, since it is widely assumed that a free market cannot be relied upon to produce private educational services of “acceptable” quality in socially “optimal” amounts. Thus, the state is called upon to finance schooling (note that, as West points out, there is a difference between “education” and mere “schooling”), usually in the form of state-managed public school systems, for a variety of reasons: among other things, public schools are expected to reduce crime, produce good citizens, provide for equal opportunities, and promote economic growth. Quite a tall order!

West examines these and other arguments in painstaking detail, subjecting them to penetrating and relentless criticism, and generally concludes that they are either lacking in cogency or based upon faulty interpretations of the evidence. His methodology is eclectic: rigorous theoretical analyses are complemented with careful historical research and a comprehensive survey of the relevant literature, including an excellent chapter on the opinions of the classical economists, contrasting especially the views of Adam Smith and John Stuart Mill (it is well to recall, in this regard, that West is also a leading Smith scholar, having written the biography Adam Smith: The Man and His Works).

To be sure, most of the historical material is drawn from nineteenth-century British experience (this edition does, however, include a new chapter on “The Political Economy of American Public School Legislation”), although this does not detract from the book’s relevance for other times and places. Similar problems are faced by virtually all societies: Should the state educate at all? If so, is a publicly managed school system the best possible solution? Does state education have unwanted and unintended side effects? In posing these questions I have been paraphrasing West. Let me now quote him directly: “Has state education become a ‘necessary’ institution simply because it is one of those institutions to which we have become accustomed?”

Serious thinking on educational policy reform cannot really begin until these questions are addressed openly and honestly. Education and the State is a bold attempt to face these issues. This handsome new edition will help to provide the wide readership it deserves. []

Professor Cole teaches economics at Universidad Francisco Marroquin in Guatemala.


May 1995

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December 2014

Unfortunately, educating people about phenomena that are counterintuitive, not-so-easy to remember, and suggest our individual lack of human control (for starters) can seem like an uphill battle in the war of ideas. So we sally forth into a kind of wilderness, an economic fairyland. We are myth busters in a world where people crave myths more than reality. Why do they so readily embrace untruth? Primarily because the immediate costs of doing so are so low and the psychic benefits are so high.
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