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Economics of Education

Paper Session

Friday, Jan. 5, 2018 2:30 PM - 4:30 PM

Pennsylvania Convention Center, 106-B
Hosted By: Econometric Society
  • Chair: Rajashri Chakrabarti, Federal Reserve Bank of New York

School Boards and Student Segregation

Hugh Macartney
,
Duke University
John D. Singleton
,
Duke University

Abstract

This paper provides the first causal evidence about how elected local school boards affect student segregation across schools. The key identification challenge is that the composition of a school board is potentially correlated with characteristics of the district, such as the extent and nature of household sorting. We overcome this issue using a regression discontinuity design at the electoral contest level, exploiting quasi-random variation from narrowly-decided elections. Such an approach is made possible by a unique dataset, which combines matched information about North Carolina school board candidates (including vote shares and political affiliation) with time-varying district-level racial and economic segregation outcomes. Focusing on the political composition of school board members, two-stage least squares estimates reveal that (relative to their non-Democrat counterparts) Democrat board members decrease racial segregation across schools: an electoral victory that shifts the board to majority Democrat causes a reduction in the black dissimilarity index across schools of 8 percentage points, while the election of even a single Democrat in the minority leads to a reduction of 15 percentage points. These estimates significantly differ from their OLS counterparts, indicating that the latter are biased upward (understating the effects). Our findings suggest that school boards realize such reductions in segregation by shifting attendance zones, a novel measure of which we construct without the need for exact geocoded boundaries. We identify two associated knock-on effects in districts with high proportions of black students: the initial boundary adjustments are somewhat counteracted through additional neighborhood sorting and board actions to reduce segregation give rise to "white flight" out of the district.

Student Loan Nudges: Experimental Evidence on Borrowing and Educational Attainment

Benjamin M. Marx
,
University of Illinois-Urbana-Champaign
Lesley J. Turner
,
University of Maryland

Abstract

We estimate the impact of student loan “nudges” on community college students' borrowing and provide the first experimental evidence of the effect of student loans on educational attainment. Nonbinding loan offers listed in students' financial aid award letters, that do not alter students' choice sets, significantly affect borrowing. Students randomly assigned to receive a nonzero loan offer were 40 percent more likely to borrow than those who received a $0 loan offer. Nudge-induced borrowing increased both GPA and credits earned by roughly 30 percent un the year of the intervention, and in the following year, increased transfers to four-year colleges by 10 percentage points (nearly 200 percent). We predict that the average student would be better off receiving a nonzero loan offer for any discount rate below 12.4 percent. Students' borrowing responses to the nudge are most consistent with a model in which nonzero offers provide information about loan eligibility, suggesting that for most students, nonzero offers are welfare enhancing. Given that over 5 million U.S. college students receive $0 loan offers, our results indicate the potential to achieve large gains in educational attainment through changes to the choice architecture around borrowing.

Persistency in Teachers' Grading Biases and Effect on Longer Term Outcomes: University Admission Exams and Choice of Field of Study

Rigissa Megalokonomou
,
University of Queensland
Victor Lavy
,
University of Warwick

Abstract

Recent research focus on what shapes gender differences in academic achievements and in university field of study. In this paper we focus on how teachers’ gender role attitudes and stereotypes influence the gender gap by affecting the environment at school. We explore the extent to which teachers’ gender bias in high school influences students’ academic performance in high-stake exams that determine admission to universities and on students’ choice of university field of study. We use data from large number of high schools in Greece and measure teachers’ bias as the difference between a student’s school exam score in 11th and in 12th grade (scored ‘non-blindly’ by the students’ teachers) and her national exam score (taken at the end of 11th and 12th grade and scored blindly). We then define a teachers’ bias measure at the class level by the difference between boy’s and girl’s average gap between the school score and the national score. Positive values indicate that a teacher is biased in favor of boys in a particular subject. We link teachers over time and are therefore able to get a persistent teacher’s bias measure based on multiple classes, and the effect is estimated for later students’ performance. The panel data on teachers relieves concerns that our measure of gender bias may just pick up random (small sample) variation in the unobserved "quality" or "non-cognitive" skills of the boys vs. girls in a particular single class or any other class specific dynamics. Our results may be summarized with three broad conclusions. First, the same teachers who are biased for one class are biased in the same way for other classes in the same year and in classes in earlier or later academic years. The very high correlations of within teachers’ biases in different classes reveal high persistency in teachers’ stereotypical behavior. Second, teachers’ biases in core and elective subjects (classics, social science, science, exact science) have positive effect on boys’ and negative effects on girls’ performance on end of high school university admission exams. Female teachers are more pro-girls on average but the effect of female and male teachers’ biases on national exams are not statistically different. Third, teachers’ biases in specific courses lower the likelihood that students enroll in a related field of study at the university. This average effect masks large heterogeneity by gender, being larger and statistically significant for girls and not different from zero for boys. However, the effect on choice of STEM subjects are large and positive for boys and small and insignificant for girls.

Getting Ahead by Spending More? Local Community Response to State Merit Aid Programs

Rajashri Chakrabarti
,
Federal Reserve Bank of New York
Nicole Gorton
,
Federal Reserve Bank of New York
Joydeep Roy
,
Columbia University

Abstract

In more than half of U.S. states over the last two decades, the implementation of merit aid programs has dramatically reduced tuition expenses for college-bound students who attend in-state colleges. In this paper, we analyze a hitherto-unexplored impact of these programs: whether merit aid programs led to changes in state support for higher education and K-12 education, and whether and how school districts responded to such changes. Exploiting the staggered adoption of state merit aid programs as a natural experiment, we employ two methodologies to study whether this has been the case: a difference-in-differences model and a synthetic control estimation strategy. We find robust evidence that implementation of merit aid programs led to an economically (and statistically) significant decline in state funding for K-12 education, underlining a potential trade-off between limited state resources and competing priorities. The decline in state aid was mostly offset through increases in local revenues by school districts, underscoring the importance of a compensatory relationship between these two forms of revenues. In states that implemented a `strong' merit aid program, these effects, particularly on state revenue, were of both an economically and statistically significant larger magnitude relative to states with weaker programs.
Discussant(s)
Stephen B. Billings
,
University of North Carolina-Charlotte
Judd Benjamin Kessler
,
University of Pennsylvania
Manuel Bagues
,
Aalto University, CEPR and IZA
Sally Hudson
,
University of Virginia
JEL Classifications
  • I21 - Analysis of Education