The Impact of Texas “Wealth Equalization” Program on the Academic Performance of Poor and Wealthy Schools

Abstract

The purpose of this study is to examine the propositions of “money matters/doesn’t matter” in a zero-sum public school system. Specifically, this study seeks to assess the impact of Texas Wealth Equalization Program on the academic performance of contributing wealthy school districts and the receiving poor school districts. Although the primary interest of this study is the aforementioned two sets of school districts, the study also incorporates a set of intermediate districts into the analysis in order to control for the possible threat of history. The study uses three state and national assessment tools to measure school performance. The results show that answer to the propositions of “money matters/doesn’t matter” is contextual. Controlling for the possible threat of history, the findings show that transfer of nearly $3.4 billion from wealthy to poor school districts did not result in lower academic achievement among the students of rich school districts while it resulted in modest performance improvement in poor districts. Policy implications of Wealth Equalization are discussed.