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Schooling, Inequality, and the Impact of Government

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  • Eric A. Hanushek
  • Julie A. Somers

Abstract

Analyses of income inequality have identified the importance of increased demand for worker skills, but characterizations of worker skills by the amount of schooling attained do not capture important aspects of the widening income distribution and of the stagnating relative wages of black workers. This paper is motivated by the possibility that schooling quality is an important component of the changing income distribution. The central analysis focuses on how governmental schooling policies particularly those related to the level and distribution of school spending affect the distribution of worker quality and of income. The substantial differences in spending across states are not significantly related to the variations in achievement growth across states. Further, the three decade old movement toward reducing the variation in school spending within states appears to have done nothing to reduce subsequent income variations of workers. Thus, the direct government policies toward school spending, as carried out in the past, have not ameliorated inequalities in incomes.

Suggested Citation

  • Eric A. Hanushek & Julie A. Somers, 1999. "Schooling, Inequality, and the Impact of Government," NBER Working Papers 7450, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:7450
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    12. Levy, Frank & Murnane, Richard J, 1992. "U.S. Earnings Levels and Earnings Inequality: A Review of Recent Trends and Proposed Explanations," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1333-1381, September.
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    Cited by:

    1. Eric A. Hanushek & Margaret E. Raymond, 2002. "Improving educational quality: how best to evaluate our schools," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 47(Jun), pages 193-247.
    2. Pereira, Pedro Telhado & Martins, Pedro Silva, 2000. "Does Education Reduce Wage Inequality? Quantile Regressions Evidence from Fifteen European Countries," FEUNL Working Paper Series wp379, Universidade Nova de Lisboa, Faculdade de Economia.
    3. Pyastolov, S.M., 2007. "Norms as indicators of human capital investments effectiveness," MPRA Paper 44451, University Library of Munich, Germany.
    4. Kristen Harknett & Irwin Garfinkel & Jay Bainbridge & Timothy Smeeding & Nancy Folbre & Sara McLanahan, 2003. "Do Public Expenditures Improve Child Outcomes in the U.S.? A Comparison across Fifty States," Center for Policy Research Working Papers 53, Center for Policy Research, Maxwell School, Syracuse University.
    5. Thomas A. Downes, 2002. "Do state governments matter?: a review of the evidence on the impact on educational outcomes of the changing role of the states in the financing of public education," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 47(Jun), pages 143-180.
    6. Reynaldo Fernandes & Amaury Patrick Gremaud & Gabriel Ulyssea, 2004. "Sistema Brasileiro De Financiamento À Educação Básica: Principais Características, Limitações E Alternativas," Anais do XXXII Encontro Nacional de Economia [Proceedings of the 32th Brazilian Economics Meeting] 132, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
    7. Mongan, Juan Carlos & Santin, Daniel & Valiño, Aurelia, 2011. "Towards the equality of educational opportunity in the province of Buenos Aires," Journal of Policy Modeling, Elsevier, vol. 33(4), pages 583-596, July.
    8. Eric A. Hanushek & Margaret E. Raymond, 2005. "Does school accountability lead to improved student performance?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 24(2), pages 297-327.
    9. Eric A. Hanushek, 2001. "Black-White Achievement Differences and Governmental Interventions," American Economic Review, American Economic Association, vol. 91(2), pages 24-28, May.

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