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California's School Finance Reform: An Experiment in Fiscal Federalism

  • Eric J. Brunner

    (Quinnipiac University and University of Connecticut)

  • Jon Sonstelie

    (University of California, Santa Barbara)

The 1971 ruling of the California Supreme Court in the case of Serrano v. Priest initiated a chain of events that abruptly ended local financing of public schools in California. In seven short years, California transformed its school finance system from a decentralized one in which local communities chose how much to spend on their schools to a centralized one in which the state legislature determines the expenditures of every school district. This paper begins by describing California's school finance system before Serrano and the transformation from local to state finance. It then delineates some consequences of that transformation and draws lessons from California's experience with school finance reform.

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Paper provided by University of Connecticut, Department of Economics in its series Working papers with number 2006-09.

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Length: 42 pages
Date of creation: Apr 2006
Date of revision:
Handle: RePEc:uct:uconnp:2006-09
Contact details of provider: Postal: University of Connecticut 365 Fairfield Way, Unit 1063 Storrs, CT 06269-1063
Phone: (860) 486-4889
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  1. Kenny, Lawrence W., 1982. "Economies of scale in schooling," Economics of Education Review, Elsevier, vol. 2(1), pages 1-24, February.
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  8. Thomas A. Husted & Lawrence W. Kenny, 2002. "The Legacy of Serrano: The Impact of Mandated Equal Spending on Private School Enrollment," Southern Economic Journal, Southern Economic Association, vol. 68(3), pages 566-583, January.
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  10. Nechyba, Thomas J., 2002. "Centralization, Fiscal Federalism and Privte School Attendance," Working Papers 02-11, Duke University, Department of Economics.
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  12. Murray, Sheila E & Evans, William N & Schwab, Robert M, 1998. "Education-Finance Reform and the Distribution of Education Resources," American Economic Review, American Economic Association, vol. 88(4), pages 789-812, September.
  13. Fernandez, Raquel & Rogerson, Richard, 1997. "Eudcation Finance Reform and Investment in Human Capital : Lessons from California," Working Papers 97-21, C.V. Starr Center for Applied Economics, New York University.
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  18. Card, David & Payne, A. Abigail, 2002. "School finance reform, the distribution of school spending, and the distribution of student test scores," Journal of Public Economics, Elsevier, vol. 83(1), pages 49-82, January.
  19. Husted, Thomas A & Kenny, Lawrence W, 2000. "Evidence on the Impact of State Government on Primary and Secondary Education and the Equity-Efficiency Trade-Off," Journal of Law and Economics, University of Chicago Press, vol. 43(1), pages 285-308, April.
  20. Thomas Downes & David Figlio, 1998. "School Finance Reforms, Tax Limits, and Student Performance: Do Reforms Level-Up or Dumb Down?," Discussion Papers Series, Department of Economics, Tufts University 9805, Department of Economics, Tufts University.
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  23. Oates, Wallace E, 1969. "The Effects of Property Taxes and Local Public Spending on Property Values: An Empirical Study of Tax Capitalization and the Tiebout Hypothesis," Journal of Political Economy, University of Chicago Press, vol. 77(6), pages 957-71, Nov./Dec..
  24. Patrick Bayer & Fernando Ferreira & Robert McMillan, 2004. "Tiebout Sorting, Social Multipliers and the Demand for School Quality," NBER Working Papers 10871, National Bureau of Economic Research, Inc.
  25. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416.
  26. Silva, Fabio & Sonstelie, Jon, 1995. "Did Serrano Cause a Decline in School Spending," National Tax Journal, National Tax Association, vol. 48(2), pages 199-215, June.
  27. Bergstrom, Theodore C & Goodman, Robert P, 1973. "Private Demands for Public Goods," American Economic Review, American Economic Association, vol. 63(3), pages 280-96, June.
  28. Oates, Wallace E., 2005. "Property taxation and local public spending: the renter effect," Journal of Urban Economics, Elsevier, vol. 57(3), pages 419-431, May.
  29. 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.
  30. Caroline M. Hoxby, 1998. "All School Finance Equalizations Are Not Created Equal," NBER Working Papers 6792, National Bureau of Economic Research, Inc.
  31. Brunner, Eric & Sonstelie, Jon, 2003. "School finance reform and voluntary fiscal federalism," Journal of Public Economics, Elsevier, vol. 87(9-10), pages 2157-2185, September.
  32. Downes, Thomas A. & Dye, Richard F. & McGuire, Therese J., 1998. "Do Limits Matter? Evidence on the Effects of Tax Limitations on Student Performance," Journal of Urban Economics, Elsevier, vol. 43(3), pages 401-417, May.
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