Schooled On The Competition

The Five Towns area has been blessed with wonderful schools. Recently it was announced that possibly two new boys’ elementary schools may be opening in our neighborhood. I personally am happy and proud to be a Darchei parent. So, this news is not directly relevant to me, yet it does relate to the current mesechta learned in the daf yomi.
There is a well-known halachah that one may not encroach upon another individual’s livelihood. Is there any such restriction on establishing a school in a neighborhood that already has a school? Can the new school actively solicit attendance by children from the other schools?
The primary source for the answer to the first question is a Gemara in Bava Basra. There the Gemara states, “Ezra issued a decree for K’lal Yisrael that they should place teachers right next to other teachers.” In ancient times, the primary method of teaching Torah was to employ an individual teacher to educate children. This sole practitioner earned his livelihood from the tuition the parents paid him directly. There were no building funds, dinners, raffles, Chinese auctions, parallel classes, or principals. So when Ezra decreed that a teacher may set up shop right next to another teacher, he was in fact encouraging direct competition. These teachers would be directly competing for the same students and the same tuition dollars.