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Evidence on the Impact of State Government on Primary and Secondary Education and the Equity-Efficiency Trade-Off

Listed author(s):
  • Husted, Thomas A
  • Kenny, Lawrence W

State governments may affect the productivity of primary and secondary education in two ways. First, various regulations imposed on local school districts are expected to make schools less efficient. Second, state efforts to reduce inequality in education spending make it more difficult for voters to increase school quality, which should lead to less voter monitoring of schools and thus less efficient schools. Our empirical analysis of state Scholastic Aptitude Test (SAT) scores from 1987 to 1992 provides evidence on both effects. The state's revenue share, which captures state meddling in local decisions, has the expected negative impact on school efficiency. But our novel result is that state-induced spending equalization also lowers average test scores but has had little if any effect on reducing the disparity in student achievement. These results bring into question policy efforts designed to shift education responsibilities from local governments to state and federal governments. Copyright 2000 by the University of Chicago.

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File URL: http://dx.doi.org/10.1086/467456
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Article provided by University of Chicago Press in its journal Journal of Law & Economics.

Volume (Year): 43 (2000)
Issue (Month): 1 (April)
Pages: 285-308

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Handle: RePEc:ucp:jlawec:v:43:y:2000:i:1:p:285-308
Contact details of provider: Web page: http://www.journals.uchicago.edu/JLE/

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  1. Eberts, Randall W & Stone, Joe A, 1991. "Unionization and Cost of Production: Compensation, Productivity, and Factor-Use Effects," Journal of Labor Economics, University of Chicago Press, vol. 9(2), pages 171-185, April.
  2. Hanushek, Eric A & Rivkin, Steven G & Taylor, Lori L, 1996. "Aggregation and the Estimated Effects of School Resources," The Review of Economics and Statistics, MIT Press, vol. 78(4), pages 611-627, November.
  3. Southwick, Lawrence Jr & Gill, Indermit S., 1997. "Unified salary schedule and student SAT scores: Adverse effects of adverse selection in the market for secondary school teachers," Economics of Education Review, Elsevier, vol. 16(2), pages 143-153, April.
  4. William N. Evans & Sheila E. Murray & Robert M. Schwab, 1997. "Schoolhouses, courthouses, and statehouses after Serrano," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 16(1), pages 10-31.
  5. Behrendt, Amy & Eisenach, Jeffrey & Johnson, William R., 1986. "Selectivity bias and the determinants of SAT scores," Economics of Education Review, Elsevier, vol. 5(4), pages 363-371, August.
  6. Dynarski, Mark, 1987. "The Scholastic Aptitude Test: Participation and performance," Economics of Education Review, Elsevier, vol. 6(3), pages 263-273, June.
  7. David Card & Abigail A. Payne, 1997. "School Finance Reform, the Distribution of School Spending, and the Distribution of SAT Scores," Working Papers 766, Princeton University, Department of Economics, Industrial Relations Section..
  8. repec:pri:indrel:dsp016395w7105 is not listed on IDEAS
  9. Graham, Amy E. & Husted, Thomas A., 1993. "Understanding state variations in SAT scores," Economics of Education Review, Elsevier, vol. 12(3), pages 197-202, September.
  10. 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 405-419, December.
  11. repec:fth:prinin:387 is not listed on IDEAS
  12. Caroline Minter Hoxby, 1994. "Do Private Schools Provide Competition for Public Schools?," NBER Working Papers 4978, National Bureau of Economic Research, Inc.
  13. 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.
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