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Institutional Effects in a Simple Model of Educational Production

  • Bishop, John H.

    ()

    (Cornell University)

  • Woessmann, Ludger

    ()

    (Ifo Institute for Economic Research)

The paper presents a model of educational production which tries to make sense of recent evidence on effects of institutional arrangements on student performance. In a simple principal-agent framework, students choose their learning effort to maximize their net benefits, while the government chooses educational spending to maximize its net benefits. In the jointly determined equilibrium, schooling quality is shown to depend on several institutionally determined parameters. The impact on student performance of institutions such as central examinations, centralization versus school autonomy, teachers' influence, parental influence, and competition from private schools is analyzed. Furthermore, the model can rationalize why positive resource effects may be lacking in educational production.

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File URL: http://ftp.iza.org/dp484.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 484.

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Length: 38 pages
Date of creation: Apr 2002
Date of revision:
Publication status: published in: Education Economics, 2004, 12 (1), 17-38
Handle: RePEc:iza:izadps:dp484
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  1. North, Douglass C, 1994. "Economic Performance through Time," American Economic Review, American Economic Association, vol. 84(3), pages 359-68, June.
  2. Andrei Shleifer, 1998. "State Versus Private Ownership," Harvard Institute of Economic Research Working Papers 1841, Harvard - Institute of Economic Research.
  3. Alan Krueger, 1997. "Experimental Estimates of Education Production Functions," Working Papers 758, Princeton University, Department of Economics, Industrial Relations Section..
  4. Betts, Julian R, 1998. "The Impact of Educational Standards on the Level and Distribution of Earnings," American Economic Review, American Economic Association, vol. 88(1), pages 266-75, March.
  5. Gundlach, Erich & Wößmann, Ludger & Gmelin, Jens, 2001. "The decline of schooling productivity in OECD countries," Munich Reprints in Economics 20451, University of Munich, Department of Economics.
  6. Edward P. Lazear, 1999. "Educational Production," NBER Working Papers 7349, National Bureau of Economic Research, Inc.
  7. Eric A. Hanushek, . "The Evidence on Class Size," Wallis Working Papers WP10, University of Rochester - Wallis Institute of Political Economy.
  8. Costrell, Robert M, 1994. "A Simple Model of Educational Standards," American Economic Review, American Economic Association, vol. 84(4), pages 956-71, September.
  9. Caroline Minter Hoxby, 1994. "Does Competition Among Public Schools Benefit Students and Taxpayers?," NBER Working Papers 4979, National Bureau of Economic Research, Inc.
  10. Bishop, J., 1997. "The Effect of national Standards and Curriculum-Based Exams on Achievement," Papers 97-01, Cornell - Center for Advanced Human Resource Studies.
  11. Caroline Minter Hoxby, 1994. "Do Private Schools Provide Competition for Public Schools?," NBER Working Papers 4978, National Bureau of Economic Research, Inc.
  12. Cecilia Elena Rouse, 1998. "Private School Vouchers And Student Achievement: An Evaluation Of The Milwaukee Parental Choice Program," The Quarterly Journal of Economics, MIT Press, vol. 113(2), pages 553-602, May.
  13. Epple, Dennis & Romano, Richard E, 1998. "Competition between Private and Public Schools, Vouchers, and Peer-Group Effects," American Economic Review, American Economic Association, vol. 88(1), pages 33-62, March.
  14. Bishop, John H, 1997. "The Effect of National Standards and Curriculum-Based Exams on Achievement," American Economic Review, American Economic Association, vol. 87(2), pages 260-64, May.
  15. Caroline M. Hoxby, 2000. "The Effects Of Class Size On Student Achievement: New Evidence From Population Variation," The Quarterly Journal of Economics, MIT Press, vol. 115(4), pages 1239-1285, November.
  16. Pritchett, Lant & Filmer, Deon, 1999. "What education production functions really show: a positive theory of education expenditures," Economics of Education Review, Elsevier, vol. 18(2), pages 223-239, April.
  17. Hoxby, Caroline Minter, 1996. "How Teachers' Unions Affect Education Production," The Quarterly Journal of Economics, MIT Press, vol. 111(3), pages 671-718, August.
  18. Joshua D. Angrist & Victor Lavy, 1999. "Using Maimonides' Rule To Estimate The Effect Of Class Size On Scholastic Achievement," The Quarterly Journal of Economics, MIT Press, vol. 114(2), pages 533-575, May.
  19. Hoxby, Caroline M., 1999. "The productivity of schools and other local public goods producers," Journal of Public Economics, Elsevier, vol. 74(1), pages 1-30, October.
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