The Economics of Government Schools

This year’s Mahopac Central School District budget proposed to increase our property taxes by approximately 10%. We rejected it by 2 to 1. While I do not like this increase, it seems like a good value, does it not? For about $7,100 per year, my daughters will receive a pretty good education. But is it? Are these prices fair, either to property owners or to parents?

As this increase is presented in terms of supply and demand — we’re expecting more sixth grade students therefore we must hire more teachers and build more classrooms — let’s consider how supply and demand affect the cost of public schools. First, the government artificially stimulates demand, through attendance requirements and truancy laws. Then, the government restricts supply by establishing school systems, and fixes a price floor through property taxes. Non-government schools will always be more expensive than the government school because those costs are in addition to the property taxes.