To predict the effect of the UTTC on state and local finances, one must predict the
behavior of individual parents. These parents are currently acting as consumers of
educational services and thus exhibit behavior much like consumers of any other service.
Such behavior includes preferring high quality services over low quality services, taking
into account factors such as location and convenience, and of course, preferring to pay
less for educational services when a lower-priced service is available with comparable
quality. A market reflecting such activity operates fairly freely in preschools, in trade
schools, and, to a certain extent, in higher education.
In the K-12 education market in Michigan, the "price" that a consumer pays to
send his or her child to an assigned public school is close to zero. The cost is not
zero—we have already discussed how private taxpayers finance the system—but the
price to the parent of sending one more child to the traditional public school is roughly
zero. The "price" of sending a child to an alternative school can be
substantially higher. These costs include the tuition as well as other costs that the
parents must pay, such as books, transportation, and fees.
