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Productivity in Education: The Quintessential Upstream Industry

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  • Caroline M. Hoxby

    () (Harvard University, Department of Economics)

Abstract

Using consistent test score data from the National Assessment of Educational Progress and data on per-pupil spending, I show that the productivity of American public schools fell by approximately half from 1970 to 2000. The most reliable international data also suggest that productivity in American public schools is lower than that of numerous other industrialized countries, including the remaining English-speaking ones. I explore explanations for the decline in productivity, including changing sociodemographics, Baumol's “cost disease,” rising wages of female college graduates, the increasing emphasis on educating disadvantaged children, rising market power, and the education sector's relative decrease in pay for performance. I review evidence that suggests that schools raise their productivity and use of pay for performance when they face competition. I also describe results that indicate that individual teachers have important, distinctive effects on achievement.

Suggested Citation

  • Caroline M. Hoxby, 2004. "Productivity in Education: The Quintessential Upstream Industry," Southern Economic Journal, Southern Economic Association, vol. 71(2), pages 209-231, October.
  • Handle: RePEc:sej:ancoec:v:71:2:y:2004:p:209=231
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    References listed on IDEAS

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    Cited by:

    1. Brennan, Shae & Haelermans, Carla & Ruggiero, John, 2014. "Nonparametric estimation of education productivity incorporating nondiscretionary inputs with an application to Dutch schools," European Journal of Operational Research, Elsevier, vol. 234(3), pages 809-818.
    2. Nathan L. Gray & John D. Merrifield & Kerry A. Adzima, 2016. "A private universal voucher program’s effects on traditional public schools," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 40(2), pages 319-344, April.
    3. Billger, Sherrilyn M., 2007. "Principal Accountability at Private Secondary Schools," IZA Discussion Papers 3162, Institute for the Study of Labor (IZA).

    More about this item

    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • I20 - Health, Education, and Welfare - - Education - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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