Analyzing the relative efficiency of Nevada secondary schools

Abstract

A definitive answer to how to allocate school-level expenditures to yield the greatest bang for the buck has continually eluded education finance researchers. With increased regulation, oversight, and sanctions resulting from the No Child Left Behind Act, paired with financial strains on states' education budgets, measuring schools' production and efficiency has become urgent. The methodology for this study was comprised of two phases. Phase I analyzed the per-pupil expenditures of middle and high schools over a three-year period and developed descriptive statistics that revealed the expenditure patterns by category. Phase II used a micro-level economic approach, data envelopment analysis, to ascertain the relative efficiency of Nevada secondary schools over a three year period. Expenditure patterns of the most and least efficient schools were examined. The major findings of the study included that there was little difference overall in spending patterns between middle and high schools; high schools spent significantly more per pupil than middle schools. School size was significantly related to schools' efficiency, with larger middle schools and smaller high schools being more efficient. High efficiency schools at both the middle and high school levels spent more on substitutes, extracurricular activities, in-service and staff development, leadership, and principals & assistant principals and spent less on safety. Low efficiency schools spent less on substitutes, extracurricular activities, leadership, principals & assistant principals, and school office. Informing educational leaders of how schools spend money and the efficiency of those decisions relative to student achievement outcomes may assist schools and districts in making future efficient and effective allocation decisions.