Does Money Matter in the Long Run? Effects of School Spending on Educational Attainment
AbstractThis paper measures the effect of increased primary school spending on students' college enrollment and completion. Using student-level panel administrative data, I exploit variation in the school funding formula imposed by Michigan's 1994 school finance reform, Proposal A. Students exposed to $1,000 (10 percent) more spending were 3 percentage points (7 percent) more likely to enroll in college and 2.3 percentage points (11 percent) more likely to earn a postsecondary degree. The effects were concentrated among districts that were urban and suburban, lower poverty, and higher achieving at baseline. Districts targeted the marginal dollar toward schools serving less-poor populations within the district.
CitationHyman, Joshua. 2017. "Does Money Matter in the Long Run? Effects of School Spending on Educational Attainment." American Economic Journal: Economic Policy, 9 (4): 256-80. DOI: 10.1257/pol.20150249
- H75 State and Local Government: Health; Education; Welfare; Public Pensions
- I21 Analysis of Education
- I22 Educational Finance; Financial Aid
- I28 Education: Government Policy