Advanced Search
MyIDEAS: Login

School Finance Reforms, Tax Limits, and Student Performance: Do Reforms Level Up or Dumb Down?

Contents:

Author Info

  • T. A. Downes
  • D. N. Figlio

Abstract

During the late 1970s and early 1980s, a majority of states substantially changed the ways in which schools were funded, either directly through court- or legislatively mandated school finance reform, or indirectly through tax and expenditure limits. To date, there have been few academic attempts to gauge the effects of these policy changes on actual outcomes of education. This paper is an attempt to fill this gap in the literature. We find compelling evidence that the imposition of tax or expenditure limits on local governments in a state results in a significant reduction in the mean for that state of student performance on standardized tests of mathematics skills. We also find that finance reforms in response to court mandates do not result in significant changes in either the mean level or the distribution of student performance on standardized tests of reading and mathematics. In addition, substantial finance reforms that are not legislative responses to explicit court mandates generally result in increases in mean student performance. Further, in those states that have implemented finance reforms of this type, the test performance of students residing in localities in which local revenues formed smaller shares of total revenue prior to the reforms improve relative to others after the reforms are implemented.

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.irp.wisc.edu/publications/dps/pdfs/dp114297.pdf
Download Restriction: no

Bibliographic Info

Paper provided by University of Wisconsin Institute for Research on Poverty in its series Institute for Research on Poverty Discussion Papers with number 1142-97.

as in new window
Length:
Date of creation:
Date of revision:
Handle: RePEc:wop:wispod:1142-97

Contact details of provider:
Postal: 3412 Social Science Building, 1180 Observatory Drive, Madison, WI 53706
Phone: (608) 262-6358
Fax: (608) 265-3119
Email:
Web page: http://www.ssc.wisc.edu/irp/dp/dplist.htm
More information through EDIRC

Related research

Keywords:

Other versions of this item:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  2. Downes, Thomas A, 1996. " An Examination of the Structure of Governance in California School Districts before and after Proposition 13," Public Choice, Springer, vol. 86(3-4), pages 279-307, March.
  3. Silva, Fabio & Sonstelie, Jon, 1995. "Did Serrano Cause a Decline in School Spending," National Tax Journal, National Tax Association, vol. 48(2), pages 199-215, June.
  4. Downes, Thomas A., 1992. "Evaluating the Impact of School Finance Reform on the Provision of Public Education: The California Case," National Tax Journal, National Tax Association, vol. 45(4), pages 405-19, December.
  5. Alan Krueger, 1997. "Experimental Estimates of Education Production Functions," Working Papers 758, Princeton University, Department of Economics, Industrial Relations Section..
  6. repec:fth:prinin:387 is not listed on IDEAS
  7. Ehrenberg, Ronald G. & Brewer, Dominic J., 1994. "Do school and teacher characteristics matter? Evidence from High School and Beyond," Economics of Education Review, Elsevier, vol. 13(1), pages 1-17, March.
  8. Dye, Richard F. & McGuire, Therese J., 1997. "The effect of property tax limitation measures on local government fiscal behavior," Journal of Public Economics, Elsevier, vol. 66(3), pages 469-487, December.
  9. Hanushek, Eric A., 2006. "School Resources," Handbook of the Economics of Education, Elsevier.
  10. Thomas J. Nechyba, 1996. "Public School Finance in a General Equilibrium Tiebout World: Equalization Programs, Peer Effects and Private School Vouchers," NBER Working Papers 5642, National Bureau of Economic Research, Inc.
  11. David Card & A. Abigail Payne, 1998. "School Finance Reform, the Distribution of School Spending, and the Distribution of SAT Scores," NBER Working Papers 6766, National Bureau of Economic Research, Inc.
  12. Raquel Fernandez & Richard Rogerson, 1997. "Education finance reform: A dynamic perspective," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 16(1), pages 67-84.
  13. Benabou, Roland, 1996. "Equity and Efficiency in Human Capital Investment: The Local Connection," Review of Economic Studies, Wiley Blackwell, vol. 63(2), pages 237-64, April.
  14. Downes, Thomas A. & Schoeman, David, 1998. "School Finance Reform and Private School Enrollment: Evidence from California," Journal of Urban Economics, Elsevier, vol. 43(3), pages 418-443, May.
  15. Caroline M. Hoxby, 2001. "All School Finance Equalizations Are Not Created Equal," The Quarterly Journal of Economics, MIT Press, vol. 116(4), pages 1189-1231, November.
  16. Downes, Thomas A. & Dye, Richard F. & McGuire, Therese J., 1998. "Do Limits Matter? Evidence on the Effects of Tax Limitations on Student Performance," Journal of Urban Economics, Elsevier, vol. 43(3), pages 401-417, May.
  17. Levine, Phillip B & Zimmerman, David J, 1995. "The Benefit of Additional High-School Math and Science Classes for Young Men and Women," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(2), pages 137-49, April.
  18. Manwaring, R.L. & Sheffrin, S.M., 1994. "The Effects of Education Equalization Litigation on the Levels of Funding: An Empirical Analysis," Papers 94-14, California Davis - Institute of Governmental Affairs.
  19. Figlio, David N., 1997. "Did the "tax revolt" reduce school performance?," Journal of Public Economics, Elsevier, vol. 65(3), pages 245-269, September.
  20. Thomas A. Husted & Lawrence W. Kenny, 2002. "The Legacy of Serrano: The Impact of Mandated Equal Spending on Private School Enrollment," Southern Economic Journal, Southern Economic Association, vol. 68(3), pages 566-583, January.
  21. Hanushek, Eric A, 1986. "The Economics of Schooling: Production and Efficiency in Public Schools," Journal of Economic Literature, American Economic Association, vol. 24(3), pages 1141-77, September.
  22. Brunner, Eric & Sonstelie, Jon, 2003. "School finance reform and voluntary fiscal federalism," Journal of Public Economics, Elsevier, vol. 87(9-10), pages 2157-2185, September.
  23. Paul N. Courant & Susanna Loeb, 1997. "Centralization of school finance in Michigan," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 16(1), pages 114-136.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Figlio, David N., 1999. "Functional form and the estimated effects of school resources," Economics of Education Review, Elsevier, vol. 18(2), pages 241-252, April.
  2. Justina A.V. Fischer, 2005. "Do Institutions of Direct Democracy Tame the Leviathan? Swiss Evidence on the Structure of Expenditure for Public Education," CESifo Working Paper Series 1628, CESifo Group Munich.
  3. Susanna Loeb & Patrick J. McEwan, 2010. "Education Reforms," NBER Chapters, in: Targeting Investments in Children: Fighting Poverty When Resources are Limited, pages 145-178 National Bureau of Economic Research, Inc.
  4. Fischer, Justina A.V., 2007. "The Impact of Direct Democracy on Public Education: Evidence for Swiss Students in Reading, Mathematics and Natural Science," Working Paper Series in Economics and Finance 688, Stockholm School of Economics.
  5. Prof. Dr. Lars P. Feld & Prof. Dr. Gebhard Kirchgässner, 2004. "Sustainable Fiscal Policy in a Federal System Switzerland as an Example," University of St. Gallen Department of Economics working paper series 2004 2004-09, Department of Economics, University of St. Gallen.
  6. Katharine L. Bradbury & Karl E. Case & Chirstopher J. Mayer, 1998. "School quality and Massachusetts enrollment shifts in the context of tax limitations," New England Economic Review, Federal Reserve Bank of Boston, issue Jul, pages 3-20.
  7. Daniel Aaronson, 1998. "The effect of school finance reform on population heterogeneity," Working Paper Series WP-98-11, Federal Reserve Bank of Chicago.
  8. C. Kirabo Jackson & Rucker Johnson & Claudia Persico, 2014. "The Effect of School Finance Reforms on the Distribution of Spending, Academic Achievement, and Adult Outcomes," NBER Working Papers 20118, National Bureau of Economic Research, Inc.
  9. Eric J. Brunner & Jon Sonstelie, 2006. "California's School Finance Reform: An Experiment in Fiscal Federalism," Working papers 2006-09, University of Connecticut, Department of Economics.
  10. David Card & A. Abigail Payne, 1998. "School Finance Reform, the Distribution of School Spending, and the Distribution of SAT Scores," NBER Working Papers 6766, National Bureau of Economic Research, Inc.
  11. Figlio, David N., 1998. "Short-Term Effects of a 1990s-Era Property Tax Limit: Panel Evidence on Oregon's Measure 5," National Tax Journal, National Tax Association, vol. 51(n. 1), pages 55-70, March.
  12. Susan E. Mayer, 2001. "How Economic Segregation Affects Children's Educational Attainment," JCPR Working Papers 235, Northwestern University/University of Chicago Joint Center for Poverty Research.
  13. Sims, David P., 2011. "Suing for your supper? Resource allocation, teacher compensation and finance lawsuits," Economics of Education Review, Elsevier, vol. 30(5), pages 1034-1044, October.
  14. Brian Jacob & Jens Ludwig, 2008. "Improving Educational Outcomes for Poor Children," NBER Working Papers 14550, National Bureau of Economic Research, Inc.
  15. Rajashri Chakrabarti & Joydeep Roy, 2010. "Effect of constraints on tiebout competition: evidence from the Michigan school finance reform," Staff Reports 471, Federal Reserve Bank of New York.
  16. Justina A.V. Fischer, 2005. "The Impact of Direct Democracy on Public Education: Performance of Swiss Students in Reading," University of St. Gallen Department of Economics working paper series 2005 2005-10, Department of Economics, University of St. Gallen.
  17. Loeb, Susanna, 2001. "Estimating the effects of school finance reform: a framework for a federalist system," Journal of Public Economics, Elsevier, vol. 80(2), pages 225-247, May.
  18. Gebhard Kirchgässner, 2001. "The Effects of Fiscal Institutions on Public Finance: A Survey of the Empirical Evidence," CESifo Working Paper Series 617, CESifo Group Munich.

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:wop:wispod:1142-97. 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: (Thomas Krichel).

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.