Bug: Voucher policies don't increase everyone's income

The vouchers explicitly say they are given to everyone, but only increase poor people’s incomes (healthcare vouchers increase middle income too). Since everyone still pays for private healthcare and schooling, that means that you end up with a lot of very poor middle and wealthy folks as a result.

Also, School Vouchers don’t reduce poverty (they increase poor income, which has no effect on poverty), but State Schools do. What’s up with that? Surely the poor not spending as much money on education would reduce poverty?

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I don’t know how the school systerm works where you’re from, but here in Sweden we have maybe the most free market oriented school system in the world. Every parent chooses which school to send their kid to, they can choose any school they want and no matter if it is a publicly traded for-profit private school or directly owned and run by the local municipality there’s no cost to the parents. Instead the school gets a certain sum of money from the government per student. I would assume the game is trying to simulate something similar with the school voucher policy.

There are major flaws with this system. Even though in theory it might sound like it provides every child with the same oppertunity to attent a good school without needing to live in an expensive area to be in the right school disctrict or pay enormous fees for fancy private schools, what actually happens is that highly educated and wealthier parents are way more invested in securing a good education for their child so they spend way more time researching which school will provide that whereas poorer parents usually sent their kids to the closest school to where they live because it seems more convenient. This results in kids from poor families getting a worse education leading to worse oppertunities later in life and a higher risk of poverty. So to me it makes total sense that school vochers don’t recude poverty. Poverty isn’t really about making X amount of money but rather being stuck at the bottom of society with no way up, having to spend less money certainly plays a role in that but there’s more too it.

It is also terrible system making sure poorly performing school improve, because if a school gets a reputation for being bad, fewer parent send their children there resulting in less money from the government meaning they get less resources to solve whatever problem is making them perform poorly in the first place. In sparsely populated areas this is especially noticable since there aren’t many schools to choose from anyways so if one collapses in this kind of death spiral, the other one might get a local monopoly meaning they can do whatever cost cutting measures they want and since all the students will come there anyways meaning their income will remain the same.

These problems might only be because our particular voucher system is uniquely terrible, but there are solid arguments for why dictating school funding via policy rather than market forces negavely impacts children growing up in poorer households leading to more poverty. (Sorry for my bad english)

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Whilst what you’re saying makes sense, countries which in Democracy can be said to be using State Schools have exactly the same problem of geographic inequality between schools (e.g. Australia where I live), and spiralling school performance. So I’m not sure the problem arises from school vouchers (maybe it still does, I’ve not read any papers on the matter). I think having zero impact on poverty compared to no policy at all makes little sense though.

That makes me think of one trade-off that currently happens in various countries:
How are schools funded, in relation to their students?

Some places try to fund all schools equally (roughly by how many students will attend, and maybe some economic considerations about what their jobs would presumably be from attending), but give schools the opportunity to raise funds from the parents in a form of charity.
This benefits the rich a lot because they’ll give quite a bit more to charity that they know will directly benefit their own kids, rather than some random nobodies on the other side of the planet.

Some places will go further and actively spend more on rich schools where rich kids are likely to attend, which is even worse for equality.

And some places do the, to me, more sensible thing, considering how much more it costs to teach kids of backgrounds that might have troubles. They’ll actively spend more per kid in poorer, often more diverse neighbourhoods. (The rich schools may or may not still be funded extra by parental charity)

So maybe, just like the prisoner handling slider, there could be one about focusing on richer or poorer neighbourhoods (or being balanced). In fact there are probably several ideas in roughly the same vain.

The voucher system for schools in the game is envisaged as a way of effectively having a state school system, but with private providers running the schools, and having parent-choice.


Under the state school system, everyone gets taxed, the state creates and runs schools, and nobody gets charged anything…
Under the voucher system, everyone gets taxed,m and handed as school voucher, which they then have to spend at a private school. The actual parents may be no better off (depending how the tax system works), but the teachers are no longer state employees, and the free market is now involved.

Arguable the vouchers are not money, and should not increase the income of anybody, as they cannot be traded, and are not really different to free schooling under the state system.

But I take the point that there is some ‘progressive element’ implied, as every student gets the same value voucher (otherwise the policy is fairly pointless), meaning this should reduce poverty, or maybe just reduce inequality?

I’m not sure it would reduce poverty or inequality necessarily. Maybe only at adequately high spending. Just because the voucher system exists doesn’t mean private schools won’t essentially market themselves to very different populations, making some of them only cheaper by voucher, but not actually free, so richer folks would still tend to funnel their kids to such more expensive schools (assuming they charge more because of better resources)
Effectively the vouchers would have to be so extensive that using those alone will be enough to fund very high quality education.
Given that, yeah, equality probably would go up and poverty down.

Thats fine, and easily modelled as we can have the poverty and equality effects only come in at high levels of vouchers,

The vouchers could reduce the income effect of private schooling on voter income, I suppose? Mostly just wasn’t sure as to the anti-poverty effect being present in state schooling but not the voucher policy- I figured that the anti-poverty effect was meant to represent that education reduces poverty, which presumably is also the case if the poor are getting a voucher roughly equivalent to the money that would’ve otherwise been spent on state schools.

It definitely improves equality because the poor have access to higher quality/quantity goods/services than they would otherwise, but that is because (under my assumptions anyway) they’re getting more/better education than they would otherwise (and so their poverty would be reduced).

Omg you have made me realise a good point. The school vouchers instead of state schools means private schools will go up, and cost people money, so yes, yikes, absolutely this needs to include a flat payment to everyone to pay for their schooling…

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Aha yeah I wasn’t sure if I had been clear enough about the problem

Thanks for this insight. Your English is good. When did this happen? Was the system liberalized in the 90’s?

The central goverment delegated resposibility to the municipalities 1991 and in 1992 private actors were encouraged by the funding reform (funding via vouchers and market forces rather than central planning). This was largely opposed by the teachers organizations and researchers on the basis of diminishing the value of teachers and increasing segregation and inequality both in terms of the quality of education and makeup of students in each school.

That’s a damn shame. Swedish social democracy has taken a step backwards from the days of Olof Palme.

Well, it’s certainly taken an economic step to the right which is to be expected, the over 100% tax rates on celebrities and progressive appropriation of company ownership through employee funds were never going to stick. Many of the other ideas he introduced are still somewhat popular today, we still spend the most in the world on foreign aid for example.

FWIW I spent a lot of time yesterday messing with numbers to try and get all this voucher system to look like it was involving sensible values, so the next update will show vouchers giving people money, which theoretically should roughly match what they need to spend on private healthcare. It will like need a fair bit of fiddling though.

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The focus is appreciated!

Does state healthcare also increase incomes then as a benefit-in-kind?

Yeah, they substitute the private sector, which is what otherwise causes the lower incomes the voucher system is meant to be compensating for- hence it being a bug report, not a balance suggestion: The income effect is supposed to be the same, but currently only state schools effectively increase income.