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School Finance Reform: Do Equalized Expenditures Imply Equalized Teacher Salaries?


  • Meg Streams

    () (Department of Public Administration, Tennessee State University)

  • J. S. Butler

    () (Martin School of Public Policy and Administration, University of Kentucky)

  • Joshua Cowen

    () (Martin School of Public Policy and Administration, University of Kentucky)

  • Jacob Fowles

    () (Department of Public Administration, University of Kansas)

  • Eugenia F. Toma

    () (Martin School of Public Policy and Administration, University of Kentucky)


Kentucky is a poor, relatively rural state that contrasts greatly with the relatively urban and wealthy states typically the subject of education studies employing large-scale administrative data. For this reason, Kentucky's experience of major school finance and curricular reform is highly salient for understanding teacher labor market dynamics. This study examines the time path of teacher salaries in Appalachian and non-Appalachian Kentucky using a novel teacher-level administrative data set. Our results suggest that the Kentucky Education Reform Act (KERA) provided a salary boost for all Appalachian teachers, resulting in a wage premium for teachers of low and medium experience and equalizing pay across Appalachian and non-Appalachian districts for teachers of high experience. However, we find that Appalachian salaries fell back to the level of non-Appalachian teachers roughly a decade following reform, at which point the pre-KERA remuneration patterns re-emerge. © 2011 Association for Education Finance and Policy

Suggested Citation

  • Meg Streams & J. S. Butler & Joshua Cowen & Jacob Fowles & Eugenia F. Toma, 2011. "School Finance Reform: Do Equalized Expenditures Imply Equalized Teacher Salaries?," Education Finance and Policy, MIT Press, vol. 6(4), pages 508-536, October.
  • Handle: RePEc:tpr:edfpol:v:6:y:2011:i:4:p:508-536

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    Cited by:

    1. Figlio, D. & Karbownik, K. & Salvanes, K.G., 2016. "Education Research and Administrative Data," Handbook of the Economics of Education, Elsevier.
    2. Cowen, Joshua M. & Butler, J.S. & Fowles, Jacob & Streams, Megan E. & Toma, Eugenia F., 2012. "Teacher retention in Appalachian schools: Evidence from Kentucky," Economics of Education Review, Elsevier, vol. 31(4), pages 431-441.
    3. Jacob Fowles, 2016. "Salaries in Space," Public Finance Review, , vol. 44(4), pages 523-548, July.

    More about this item


    school finance reform; teacher salaries; equalized pay; Kentucky Education Reform Act;

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid


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