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The Determinants of Public Education Expenditures: Evidence from the States, 1950-1990

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  • Raquel Fernandez
  • Richard Rogerson

Abstract

We examine a panel data set for the US states over the period 1950-1990 and use it to assess the effects of growth in personal income and number of students on expenditure on public primary and secondary education. Our analysis suggests that the share of personal income devoted to education is roughly constant, implying that per student education expenditures grow at roughly the same rate as personal income per student. We also find evidence that additional factors accounted for an increase in education expenditures over the period 1950-1970.

Suggested Citation

  • Raquel Fernandez & Richard Rogerson, 1997. "The Determinants of Public Education Expenditures: Evidence from the States, 1950-1990," NBER Working Papers 5995, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:5995
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    1. Bergstrom, Theodore C & Rubinfeld, Daniel L & Shapiro, Perry, 1982. "Micro-Based Estimates of Demand Functions for Local School Expenditures," Econometrica, Econometric Society, vol. 50(5), pages 1183-1205, September.
    2. Murray, Sheila E & Evans, William N & Schwab, Robert M, 1998. "Education-Finance Reform and the Distribution of Education Resources," American Economic Review, American Economic Association, vol. 88(4), pages 789-812, September.
    3. Fernandez, Raquel & Rogerson, Richard, 1998. "Public Education and Income Distribution: A Dynamic Quantitative Evaluation of Education-Finance Reform," American Economic Review, American Economic Association, vol. 88(4), pages 813-833, September.
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    1. Emanuela di Gropello, 2006. "Meeting the Challenges of Secondary Education in Latin America and East Asia : Improving Efficiency and Resource Mobilization," World Bank Publications - Books, The World Bank Group, number 7173, December.
    2. David Fielding & Sebastian Torres, 2009. "Health, Wealth, Fertility, Education, and Inequality," Review of Development Economics, Wiley Blackwell, vol. 13(1), pages 39-55, February.
    3. Rashidul Islam Sheikh, 2019. "Analysis of the Determinants of Public Education Expenditures in Bangladesh," Journal of Public Administration and Governance, Macrothink Institute, vol. 9(3), pages 151-178, December.
    4. Luis Ayala & Ana Herrero & Jorge Martinez-Vazquez, 2019. "Welfare Benefits in Highly Decentralized Fiscal Systems: Evidence on Interterritorial Mimicking," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1905, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    5. Gianko Michailidis & Concepció Patxot & Meritxell Solé, 2019. "Do pensions foster education? An empirical perspective," Applied Economics, Taylor & Francis Journals, vol. 51(38), pages 4127-4150, August.
    6. Lars-Erik Borge & Jørn Rattsø, 2007. "Young and old competing for public welfare services," Working Paper Series 8607, Department of Economics, Norwegian University of Science and Technology.
    7. Cohen-Zada, Danny & Justman, Moshe, 2003. "The political economy of school choice: linking theory and evidence," Journal of Urban Economics, Elsevier, vol. 54(2), pages 277-308, September.
    8. Britta Baum & Helmut Seitz, 2003. "Demographischer Wandel und Bildungsausgaben: empirische Evidenz für die westdeutschen Länder," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 72(2), pages 205-219.
    9. Casamatta, G. & Batté, L., 2016. "The Political Economy of Population Aging," Handbook of the Economics of Population Aging, in: Piggott, John & Woodland, Alan (ed.), Handbook of the Economics of Population Aging, edition 1, volume 1, chapter 0, pages 381-444, Elsevier.
    10. Sean Corcoran & William N. Evans, 2010. "Income Inequality, the Median Voter, and the Support for Public Education," NBER Working Papers 16097, National Bureau of Economic Research, Inc.
    11. Arze del Granado, F. Javier & Martinez-Vazquez, Jorge & McNab, Robert M., 2012. "Decentralized Governance and Preferences for Public Goods," MPRA Paper 42459, University Library of Munich, Germany.
    12. Julian Ramajo & Javier Salinas & Francisco Pedraja & Miguel Márquez, 2007. "Competition in the allocation of public spending: a new model to analyse the interaction between expenditure categories," Economics Bulletin, AccessEcon, vol. 8(4), pages 1-7.
    13. Monojit Chatterji & Sushil Mohan & Sayantan Ghosh Dastidar, 2015. "Determinants of public education expenditure: evidence from Indian states," International Journal of Education Economics and Development, Inderscience Enterprises Ltd, vol. 6(1), pages 1-19.
    14. Jacob Braude, 2000. "Age Structure and the Real Exchange Rate," Bank of Israel Working Papers 2000.10, Bank of Israel.
    15. La Ferrara, Eliana & Mele, Angelo, 2006. "Racial Segregation and Public School Expenditure," CEPR Discussion Papers 5750, C.E.P.R. Discussion Papers.
    16. Andrzej Kwiatkowski, 2013. "Education investment effects of affirmative action policy. Contest game argument," Dundee Discussion Papers in Economics 279, Economic Studies, University of Dundee.
    17. Georges Casamatta & L. Batté, 2016. "The Political Economy of Population Aging," Post-Print hal-02520521, HAL.
    18. David Fielding & Mark McGillivray & Sebastian Torres, 2006. "A Wider Approach to Aid Effectiveness: Correlated Impacts on Health, Wealth, Fertility and Education," WIDER Working Paper Series RP2006-23, World Institute for Development Economic Research (UNU-WIDER).
    19. Inna Verbina & Abdur Chowdhury, 2002. "What Determines Public Education Expenditures in a Transition Economy?," WIDER Working Paper Series DP2002-60, World Institute for Development Economic Research (UNU-WIDER).
    20. Oberndorfer, Ulrich & Steiner, Viktor, 2006. "Intergenerational Conflict, Partisan Politics, and Public Higher Education Spending: Evidence from the German States," IZA Discussion Papers 2417, Institute of Labor Economics (IZA).
    21. Ece H. Guleryuz, 2015. "Interest Groups and Political Economy of Public Education Spending," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 4(3), pages 28-41, July.
    22. Ulrich Oberndorfer & Viktor Steiner, 2006. "Generationen- oder Parteienkonflikt?: Eine empirische Analyse der deutschen Hochschulausgaben," Discussion Papers of DIW Berlin 603, DIW Berlin, German Institute for Economic Research.
    23. Jacob Braude, 2001. "Generational Conflict? Some Cross-Country Evidence," Bank of Israel Working Papers 2001.06, Bank of Israel.

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    More about this item

    JEL classification:

    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education

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