School Spending Research Articles

Non linear correlated random effects models with endogeneity and unbalanced panels

We present simple procedures for estimating non linear panel data models in the presence of unobserved heterogeneity and possible endogeneity with respect to time-varying unobservables. We combine a correlated random effects approach with a control function approach while accounting for missing time periods for some units. We examine the performance of the approach in comparisons with standard estimators using Monte Carlo simulation. We apply the methods to estimate the effects of school spending on student pass rates on a standardized math exam. We find that a 10% increase in spending leads to an approximately 2 percentage point increase in math pass rates.

JUE insight: The impact of school spending on civic engagement: Evidence from school finance reforms

A primary rationale for public financing of schools is that education fosters civic engagement. However, existing studies examining the relationship between schooling and civic engagement have focused exclusively on how educational attainment affects political activity. We provide evidence on how school spending affects volunteerism and voting. Exploiting variation in U.S. court-ordered and legislative school finance reforms and using survey data from the NCES Secondary Longitudinal Studies Program, we find that exogenous increases in school spending led to increases in the probability that young adults volunteer, the amount of time they spend volunteering, and the probability of being registered to vote.

How State Takeovers of School Districts Affect Education Finance, 1990 to 2019

Abstract State takeovers of school districts—a form of political centralization that shifts decision-making power from locally elected leaders to the state—have increased over time, often with the purported goal of improving district financial condition. Takeover has affected millions of students since the first takeover in 1988 and has been more common in districts serving marginalized communities. We investigate whether 104 takeovers from 1990 to 2019 affect financial outcomes using event study methods. We find that takeovers increase annual school spending by roughly $2,000 per pupil after five years, leading to improvements in some aspects of financial condition (budgetary and long-run solvency), on average. New funds primarily come from state revenues and mostly cover districts' legacy costs (debt and employee benefits). These effects are larger when takeovers are motivated by academic and/or other, non-fiscal reasons. However, takeovers are experienced unequally, with Black students less likely to experience the takeover-induced increases to expenditures and improvements in fiscal condition. This suggests political centralization can promote fiscal health but with potentially concerning equity implications.

The impact of performance information on citizen perceptions of school district efficiency, trust in government, and support for taxes

AbstractWe report the results of a random assignment experiment that examines the effect of revealing actual school district performance on three important outcomes: perceptions of efficiency, trust in government, and support for higher taxes for increased school spending. We randomly assign survey respondents to a control group or experimental condition that includes information about how their school district's test scores compare to their state average. Our study includes 2604 observations from an on‐line panel fielded in the United States from October through December, 2022 which allows us to precisely estimate the effect of performance information on outcomes. We find that providing high‐performance information has significant and substantial effects that improve efficiency perceptions, trust in the school district, and support for taxes.

Synergistic Impacts of Expansions in Pre-K Access and School Funding on Student Achievement: Evidence from California’s Transitional Kindergarten Rollout

This paper investigates the extent to which expansions in public pre-K and increases in K12 funding improve student learning trajectories and narrow achievement gaps. I link school-and student-level information on public preschool participation with longitudinal student data for all public school students in California. The research design exploits Transitional Kindergarten's (TK's) age eligibility cutoffs and the 2013-2019 staggered implementation of California's school funding reform. This quasi-experimental variation is combined to investigate interactive effects between TK attendance and school resources in elementary school. I find positive synergistic effects of TK and elementary school spending on math and reading achievement.

Exploring Teen Suicide Rates through the Lens of Macro Risk Factors

ABSTRACT As the second leading cause of death in teenagers, suicide has been a consistent public health issue for the past decade. Our goal is to understand the relationship between increasing teen suicide rates by state policies. We explore links between macro-level risk factors and state suicide rates. Risk factors explored include state behavioral health spending, child access policies for firearms, insurance coverage, tax revenue from tobacco and alcohol, school spending per pupil, pupil support services funding, and teacher spending. This research shows a relationship between pupil support spending, any child access law, required legislation, and lower teen suicide rates. The results from this study can aid in the understanding of macro-level influences on teen suicide; empowering advocates, lawmakers, and researchers to develop informed interventions and policies. Increasing multi-level understanding around suicide can provide an opportunity to slow or stop suicide rates.

The impact of demographic structure on citizen perceptions of school district efficiency

ABSTRACT Researchers have found that elderly white voters are less supportive of school spending if they reside in a community with a high concentration of non-white school children, a finding typically attributed to growing intergenerational and ethnic conflict between older and younger generations. We test whether white voters living in high minority areas are more likely to perceive their schools as being inefficient and find evidence of such racial mismatch consistent with the literature. One explanation is that white voters in high minority areas may believe schools are inefficient because of the correlation between minority concentration and poverty, given that it is more expensive to educate children in poverty. A second possibility is that white voters in high minority areas believe schools are inefficient because of bias, whether conscious or unconscious. We find convincing evidence of this second explanation that bias produces the racial mismatch effect for older white individuals.

Contexts of Convenience: Generalizing from Published Evaluations of School Finance Policies.

Recent attention to the causal identification of spending impacts provides improved estimates of spending outcomes in a variety of circumstances, but the estimates are substantially different across studies. Half of the variation in estimated funding impact on test scores and over three-quarters of the variation of impacts on school attainment reflect differences in the true parameters across study contexts. Unfortunately, inability to describe the circumstances underlying effective school spending impedes any attempts to generalize from the extant results to new policy situations. The evidence indicates that how funds are used is crucial to the outcomes, but such factors as targeting of funds or court interventions fail to explain the existing pattern of results.

What Impacts Can We Expect from School Spending Policy? Evidence from Evaluations in the United States

We conduct meta-analysis on a comprehensive set of studies of the impacts of US K-12 public school spending on student outcomes–estimating average marginal impacts and heterogeneity across contexts. On average, a policy increasing spending by $1,000 per pupil for four years improves test scores by 0.0316σ and college-going by 2.8 pp. Moving beyond averages, we use estimates of heterogeneity and observable policy differences to produce informative probability distributions of policy effects. Effects are smaller for economically advantaged populations, marginal effects of capital spending are similar to noncapital, and effects are similar across baseline spending levels and geography. Confounding and publication biases are minimal.(JEL H75, I21, I22, I26, I28)

Measuring the Efficacy of Zearn Math in Louisiana

This study examines the impact of an online math learning program on third through fifth grade math achievement in Louisiana. Employing Zearn Math usage metrics and administrative data from the Louisiana Department of Education, the results indicate that grade levels that programmatically used Zearn Math scored, on average, about .03 standard deviation units higher on Louisiana’s statewide math assessment. A placebo test using English-language arts scores and several robustness checks suggests that this may be an underestimate of the true effect. These findings come at a crucial time because pandemic-related school closures have led to a 20-fold increase in public school spending on Zearn-related materials between July 2019 and July 2021, and its presence continues to expand across the nation.

Funding High-poverty School Districts: Federal Policy Tools and the Limits of Incentives

Abstract What can the federal government do to help ensure that the public schools attended by children living in poverty have enough resources to serve their students? In this brief, we describe existing federal efforts to support education spending in high-poverty districts, discuss their limitations, and suggest alternative approaches for federal policy. We focus especially on the Education Finance Incentive Grant (EFIG) formula—a part of the compensatory Title I grant program designed to encourage changes to state school finance policy—and show that the incentives embedded in the formula are in fact negligible; revising the formula to be more effective would be difficult. Further, any attempt to incentivize desirable state policy faces a fundamental trade-off: Such policy can reinforce inequality because districts in states that do not respond to the incentives by adopting desirable policies also do not receive (as much) federal funding. We argue that federal policy should be more attentive to state fiscal capacity because it is an important determinant of district-level school spending, and the federal government is uniquely positioned to address between-state inequality.

Improving public school productivity: Evidence from model schools in India

This paper studies the impact of India’s “model” school program which aimed to provide high quality education to economically disadvantaged students. Model schools combine better infrastructure with more accountability, contract teachers, and lower per-pupil spending than regular public schools. Using a fuzzy Regression Discontinuity Design based on entrance exam cutoffs, I find attending a model school for five years increases test scores in math by 0.38 standard deviations, in science by 0.26 sd, and in social science by 0.26 sd on average. Furthermore, model schools increase the probability of joining pre-university by 11.5 percentage points. The results suggest it is possible to deliver substantial improvement of outcomes in public schools at a slightly lower level of school spending through a package of reforms.

Education Leadership: Legal and Social Impacts of Public Schools Leadership and Management on the City of Baltimore Maryland, United States of America

This study assessed the correlation between per student expenditure and academic achievement, examining legal issues, poverty, and crime as chronic factors impacting low academic performance as parents’ legal actions against the City School Board of Commissioners question the effectiveness of public school spending. Ineffective leadership, mismanagement, poverty, and crime contribute to subpar performance, necessitating new strategies for learning, teaching, and meeting high academic standards. The Baltimore City public school system has faced challenges in academic achievement, poverty, and crime over the past decades. Maryland's Blueprint for the Future and meta research emphasize the importance of effective leadership and quality education to enhance student achievement, socioeconomic growth, and reduce crime. The present research analyzed various factors influencing public school performance, including per teacher and pupil expenditure, while correlating SAT and ACT scores with academic improvement in Baltimore City, Maryland. Besides, it is declared that effective educational leadership is imperative in a data driven culture whose challenges lie not in advanced technology itself but rather in the transformation of repressive cultures, teams, and practices.

New York

The Executive Budget reflects Governor Hochul’s strong commitment to education by providing additional funding and services to meet the needs of students, teachers, and schools amid the pandemic. New York school spending will be pushed to new heights by the latest state budget, which boosts state aid to schools by $2 billion, or 7.2%, including a permanent, phased-in, and multiyear “foundation aid” formula boost. On top of that, New York schools last year were handed another $9 billion in special “emergency relief fund” aid via the Biden administration’s American Rescue Plan.

Incidence and Outcomes of School Finance Litigation: 1968–2021

State courts regularly enter in school finance decision making. School finance court cases have proceeded one or more times in all but two states. Plaintiffs ask the courts to rule that the existing funding formula is unconstitutional under state constitutions, and the defendants call for continuation of the existing finance formula. By compiling and analyzing the universe of such cases, we can accurately describe the nature of the cases, the decisions made, and the long run impact on overall financing of schools. Defendants win a slight majority of decisions with, surprisingly, their victories coming most frequently in low spending states and in low achieving states. And, while plaintiff victories on average yield an immediate increase in funding, they have no influence on long run growth in school spending.

Point column on school spending: Money matters

Point column on school spending: Money matters

Does school spending matter?

Does school spending matter?

School spending and extension of the youth voting franchise: Quasi-experimental evidence from Norway

School spending and extension of the youth voting franchise: Quasi-experimental evidence from Norway

Returns to School Spending in Rural America: Evidence from Wisconsin's Sparsity Aid Program

Returns to School Spending in Rural America: Evidence from Wisconsin's Sparsity Aid Program

Citizen perceptions of public school efficiency: evidence from the U.S.

ABSTRACT Improving efficiency is the basis for important public school reforms. While there has been substantial scholarship examining the relationship between actual and perceived performance, there has been very little research examining this relationship for efficiency. We use a large and representative sample of U.S. residents and data on student achievement and public school spending to examine the relationship between actual and perceived efficiency. We find a strong positive relationship between actual efficiency and our measure of perceived efficiency. Our research supports the normative tendency of public managers towards increased transparency and suggests that citizens will respond appropriately to information.