Does School District Consolidation Cut Costs?
Consolidation has dramatically reduced the number of school districts in the United States. Using data from rural school districts in New York, this article provides the first direct estimation of consolidation's cost impacts. We find economies of size in operating spending: all else equal, doubling enrollment cuts operating costs per pupil by 61.7 percent for a 300-pupil district and by 49.6 percent for a 1,500-pupil district. Consolidation also involves large adjustment costs, however. These adjustment costs, which are particularly large for capital spending, lower net cost savings to 31.5 percent and 14.4 percent for a 300-pupil and a 1,500-pupil district, respectively. Overall, consolidation makes fiscal sense, particularly for very small districts, but states should avoid subsidizing unwarranted capital projects. © 2007 American Education Finance Association
Volume (Year): 2 (2007)
Issue (Month): 4 (September)
|Contact details of provider:|| Web page: http://mitpress.mit.edu/journals/|
|Order Information:||Web: http://www.mitpressjournals.org/loi/edfp|
When requesting a correction, please mention this item's handle: RePEc:tpr:edfpol:v:2:y:2007:i:4:p:341-375. 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: (Kristin Waites)
If references are entirely missing, you can add them using this form.