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The response of public education spending to changes in student cohort sizes

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  • Samuel Luethi
  • Maria Zumbuehl

Abstract

In this paper, we study the elasticity of educational spending with respect to changing student numbers, in a system where educational spending is autonomously determined at a regional level. While many studies focus on a potential effect of ageing society on educational spending, only a few explicitly analyse the direct effect of changing cohort sizes. We find that education expenditures respond rather loosely to changing student numbers and that the elasticity strongly depends on regional and institutional settings. In rural areas, for instance, educational spending tends to be completely inelastic, which raises questions regarding both, efficiency and equity concerns.

Suggested Citation

  • Samuel Luethi & Maria Zumbuehl, 2022. "The response of public education spending to changes in student cohort sizes," Economics of Education Working Paper Series 0198, University of Zurich, Department of Business Administration (IBW).
    • Handle: RePEc:iso:educat:0198
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    References listed on IDEAS

    as
    1. Richard T. Boylan & Vivian Ho, 2017. "The Most Unkindest Cut of All? State Spending on Health, Education, and Welfare During Recessions," National Tax Journal, National Tax Association;National Tax Journal, vol. 70(2), pages 329-366, June.
    2. Lars-Erik Borge & Jørn Rattsø, 2007. "Young and old competing for public welfare services," Working Paper Series 8607, Department of Economics, Norwegian University of Science and Technology.
    3. Fernandez, Raquel & Rogerson, Richard, 1998. "Public Education and Income Distribution: A Dynamic Quantitative Evaluation of Education-Finance Reform," American Economic Review, American Economic Association, vol. 88(4), pages 813-833, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Public education spending; demographic change;

    JEL classification:

    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • R51 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Finance in Urban and Rural Economies

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