While looking for reasons to use wikis in education, I came across this article:
Wikis In Education and other tools for Collaborative Writing
http://tep.uoregon.edu/shared/blogswikispodcasts/WikisBiblio.pdf
The article provided some great reasons to use a wiki in your classroom:
Students can focus on what they need to write about rather than how to create it as required by a website, teachers can follow the progress of their students throughout the project, wikis can be used to track the progress of a group project, and projects can be revised by each member of the group making it a truly collaborative effort.
The article also lists a number of both free and paid wiki hosting sites.