Advanced Search
MyIDEAS: Login to save this article or follow this journal

Reforming Reforms: Changing Incentives in Education Finance in Vermont

Contents:

Author Info

  • Stephen J. Schmidt

    ()
    (Department of Economics, Union College)

  • Karen Scott

    (Department of Economics, Union College)

Registered author(s):

    Abstract

    In 1997, Vermont passed Act 60, which reformed its education finance system to achieve greater equality of spending. The reform encouraged wealthy towns to reduce spending; it was politically unpopular and was replaced, in 2004, by Act 68. We analyze the spending incentives created by the two acts and estimate the effects the change will have on spending inequality. Act 68 reduces tax prices for education spending in all towns, but reduces them disproportionately for wealthy towns. It increases education spending in Vermont but also increases inequality of spending. Because spending is inelastic with respect to tax prices, the increase in inequality is small relative to existing inequality. Our findings demonstrate that understanding the way towns respond to financial incentives, economically and politically, is critical in designing successful reforms. They suggest that it is difficult to maintain finance systems that give wealthy towns strong incentives to spend less or subsidize poorer towns. Using state revenues to subsidize schools achieves nearly asmuch equality as more explicit attempts to force wealthy districts to share resources. © 2006 American Education Finance Association

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/edfp.2006.1.4.441
    Download Restriction: Access to PDF is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by MIT Press in its journal Education Finance and Policy.

    Volume (Year): 1 (2006)
    Issue (Month): 4 (September)
    Pages: 441-464

    as in new window
    Handle: RePEc:tpr:edfpol:v:1:y:2006:i:4:p:441-464

    Contact details of provider:
    Web page: http://mitpress.mit.edu/journals/

    Order Information:
    Web: http://www.mitpressjournals.org/loi/edfp

    Related research

    Keywords: education finance; spending inequality; Vermont;

    Find related papers by JEL classification:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:tpr:edfpol:v:1:y:2006:i:4:p:441-464. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Karie Kirkpatrick).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.