Efficient utilization of resources in public schools: a case study of New Jersey

Abstract

The academic performance of public schools in the United States has been declining for more than two decades now, and this is a hotly debated topic since this deterioration in performance has important implications on the quality of labour and on the productivity growth of the nation (Bishop, 1989). Moreover, the performance among school districts in states varies significantly, raising questions about the factors contributing to the large variability in performance. One area where the current debate has been focused is the ability and quality of the school management to use the available resources efficiently, giving rise to the issues of a voucher system and the private management of the public schools. This study measures the efficiency of public schools for the state of New Jersey using the data envelopment analysis (DEA) method; it also examines the effect of certain socio-economic factors on efficiency. We find that the average efficiency for all schools is 81%. The wealthiest districts have an efficiency score of 88% while for the neediest districts the efficiency is 63%. However, when we adjust for socio-economic factors the difference between the two groups becomes smaller.