Do School Spending Cuts Matter? Evidence from the Great Recession
Kirabo Jackson, Cora Wigger & Heyu Xiong
NBER Working Paper, January 2018
Audits of public school budgets routinely find evidence of waste. Also, recent evidence finds that when school budgets are strained, public schools can employ cost-saving measures with no ill-effect on students. We theorize that if budget cuts induce schools to eliminate wasteful spending, the effects of spending cuts may be small (and even zero). To explore this empirically, we examine how student performance responded to school spending cuts induced by the Great Recession. We link nationally representative test score and survey data to school spending data and isolate variation in recessionary spending cuts that were unrelated to changes in economic conditions. Consistent with the theory, districts that faced large revenue cuts disproportionately reduced spending on non-core operations. However, they still reduced core operational spending to some extent. A 10 percent school spending cut reduced test scores by about 7.8 percent of a standard deviation. Moreover, a 10 percent spending reduction during all four high-school years was associated with 2.6 percentage points lower graduation rates. While our estimates are smaller than some in the literature, spending cuts do matter.
Postsecondary Schooling and Parental Resources: Evidence from the PSID and HRS
Steven Haider & Kathleen McGarry
Education Finance and Policy, Winter 2018, Pages 72-96
We examine the association between young adult postsecondary schooling and parental financial resources using two datasets that contain high-quality data on parental resources: the Panel Study of Income Dynamics (PSID) and the Health and Retirement Study (HRS). We find the association to be pervasive — it exists for income and wealth, it extends far up the income and wealth distributions, it remains even after we control for a host of other characteristics, and it continues beyond simply beginning postsecondary schooling to completing a four-year degree. Using the Transition to Adulthood supplement to the PSID, we also find that financial resources strongly affect postsecondary schooling for all levels of high school achievement, and particularly for those at the highest level.
College Financing Choices and Academic Performance
Christiana Stoddard, Carly Urban & Maximilian Schmeiser
Journal of Consumer Affairs, forthcoming
The rapid increase in student loan debt outstanding has garnered significant media and policy attention over the past several years. In contrast, little is known about the short-term academic consequences of borrowing to finance college attendance. We use detailed student-level administrative data to examine the relationship between the type and amount of student loans used to pay for college and students' academic performance, choice of major, and retention rates. The results suggest that students who take out loans have lower grade point averages (GPAs) than students who do not. Among students with debt, those with greater student loan balances have lower GPAs, take fewer credits per semester, and have lower retention rates. This is true conditioning on detailed background characteristics as well as in individual fixed effect specifications that control for unobserved time-constant characteristics of students. These results can help inform policies to mitigate the adverse effects of increasing education debt.
ACT for All: The Effect of Mandatory College Entrance Exams on Postsecondary Attainment and Choice
Education Finance and Policy, Summer 2017, Pages 281-311
This paper examines the effects of requiring and paying for all public high school students to take a college entrance exam, a policy adopted by eleven states since 2001. I show that prior to the policy, for every ten poor students who score college-ready on the ACT or SAT, there are an additional five poor students who would score college-ready but who take neither exam. I use a difference-in-differences strategy to estimate the effects of the policy on postsecondary attainment and find small increases in enrollment at four-year institutions. The effects are concentrated among students less likely to take a college entrance exam in the absence of the policy and students in the poorest high schools. The students induced by the policy to enroll persist through college at approximately the same rate as their inframarginal peers. I calculate that the policy is more cost-effective than traditional student aid at boosting postsecondary attainment.
The Effects of Academic Probation on College Success: Regression Discontinuity Evidence from Four Texas Universities
Jason Fletcher & Mansur Tokmouline
University of Wisconsin Working Paper, December 2017
While nearly all colleges and universities in the United States use academic probation as a means to signal to students a need to improve performance, very little is known about the use of this designation and the programs that accompany it on college success. This paper uses a regression discontinuity approach to estimate the effects of these programs at four universities of varying selectivity in Texas. Results suggest that academic probation status following the first semester of college may serve as a short term "wake up call" to some students, in that second semester performance is improved. However, our findings also suggest that this short term boost in performance fades out over time and students who are on academic probation following their first semesters of college do not have higher rates of persistence or graduation. We also find important differential responses to academic probation based on pre-determined student characteristics as well as high school of origin. However none of the heterogeneous effects are consistent across universities, limiting the application of simple models of education standards.
Educational and Criminal Justice Outcomes 12 Years After School Suspension
Youth & Society, forthcoming
A third of U.S. students are suspended over a K-12 school career. Suspended youth have worse adult outcomes than nonsuspended students, but these outcomes could be due to selection bias: that is, suspended youth may have had worse outcomes even without suspension. This study compares the educational and criminal justice outcomes of 480 youth suspended for the first time with those of 1,193 matched nonsuspended youth from a nationally representative sample. Prior to suspension, the suspended and nonsuspended youth did not differ on 60 pre-suspension variables including students’ self-reported delinquency and risk behaviors, parents’ reports of socioeconomic status, and administrators’ reports of school disciplinary policies. Twelve years after suspension (ages 25-32), suspended youth were less likely than matched nonsuspended youth to have earned bachelor’s degrees or high school diplomas, and were more likely to have been arrested and on probation, suggesting that suspension rather than selection bias explains negative outcomes.
Online Course-taking and Student Outcomes in California Community Colleges
Cassandra Hart, Elizabeth Friedmann & Michael Hill
Education Finance and Policy, Winter 2018, Pages 42-71
This paper uses fixed effects analyses to estimate differences in student performance under online versus face-to-face course delivery formats in the California Community College system. On average, students have poorer outcomes in online courses in terms of the likelihood of course completion, course completion with a passing grade, and receiving an A or B. These estimates are robust across estimation techniques, different groups of students, and different types of classes. Accounting for differences in instructor characteristics (including through the use of instructor fixed effects) dampens but does not fully explain the estimated relationships. Online course-taking also has implications for downstream outcomes, although these effects are smaller. Students are more likely to repeat courses taken online, but are less likely to take new courses in the same subject following courses taken online.
Education Reform in General Equilibrium: Evidence from California's Class Size Reduction
Michael Gilraine, Hugh Macartney & Robert McMillan
NBER Working Paper, January 2018
This paper sheds new light on general equilibrium responses to major education reforms, focusing on a sorting mechanism likely to operate whenever a reform improves public school quality significantly. It does so in the context of California's statewide class size reduction program of the late-1990s, and makes two main contributions. First, using a transparent differencing strategy that exploits the grade-specific roll-out of the reform, we show evidence of general equilibrium sorting effects: Improvements in public school quality caused marked reductions in local private school shares, consequent changes in public school demographics, and significant increases in local house prices -- the latter indicative of the reform's full impact. Second, using a generalization of the differencing approach, we provide credible estimates of the direct and indirect impacts of the reform on a common scale. These reveal a large pure class size effect of 0.11 SD (in terms of mathematics scores), and an even larger indirect effect of 0.16 SD via induced changes in school demographics. Further, we show that both effects persist positively, giving rise to an overall policy impact estimated to be 0.4 SD higher after four years of treatment (relative to none). The analysis draws attention, more broadly, to conditions under which the indirect sorting effects of major reforms are likely to be first order.
A Multicomponent, Preschool to Third Grade Preventive Intervention and Educational Attainment at 35 Years of Age
Arthur Reynolds, Suh-Ruu Ou & Judy Temple
JAMA Pediatrics, forthcoming
Design, Setting, and Participants: This matched-group, alternative intervention study assessed 1539 low-income minority children born in 1979 or 1980 who grew up in high-poverty neighborhoods in Chicago, Illinois. The comparison group included 550 children primarily from randomly selected schools participating in the usual early intervention. A total of 989 children who entered preschool in 1983 or 1984 and completed kindergarten in 1986 were included in the Chicago Longitudinal Study and were followed up for 27 to 30 years after the end of a multicomponent intervention. A total of 1398 participants (90.8%) in the original sample had educational attainment records at 35 years of age. The study was performed from January 1, 2002, through May 31, 2015.
Interventions: The Child-Parent Center Program provides school-based educational enrichment and comprehensive family services from preschool to third grade (ages 3-9 years).
Results: A total of 1539 participants (mean [SD] age, 35.1 [0.32] years; 1423 [92.9%] black and 108 [7.1%] Hispanic) were included in the study. After weighting on 2 propensity scores, preschool participants had higher rates of postsecondary degree completion, including associate’s degree or higher (15.7% vs 10.7%; difference, 5.0%; 95% CI, 1.0%-9.0%), master’s degree (4.2% vs 1.5%; difference, 2.7%; 95% CI, 1.3%-4.1%), and years of education (12.81 vs 12.32; difference, 0.49; 95% CI, 0.20-0.77). Duration of participation showed a consistent linear association with outcomes. Compared with fewer years, preschool to second or third grade participation led to higher rates of associate’s degree or higher (18.5% vs 12.5%; difference, 6.0%; 95% CI, 1.0%-11.0%), bachelor’s degree (14.3% vs 8.2%; difference, 6.1%; 95% CI, 1.3%-10.9%), and master’s degree or higher (5.9% vs 2.3%; difference, 3.6%; 95% CI, 1.4%-5.9%). The pattern of benefits was robust and favored male participants for high school graduation, female participants for college attainment, and those from lower-educated households.
The Fiscal Externalities of Charter Schools: Evidence from North Carolina
Helen Ladd & John Singleton
Duke University Working Paper, December 2017
A significant criticism of the charter school movement is that funding for charter schools diverts money away from traditional public schools. As shown in prior work by Bifulco and Reback (2014) for two urban districts in New York, the magnitude of such adverse fiscal externalities depends in part on the nature of state and local funding policies. In this paper, we build on their approach to examine the fiscal effects of charter schools on both urban and non-urban school districts in North Carolina. We base our analysis on detailed balance sheet information for a sample of school districts that experienced significant charter entry since the statewide cap on charters was raised in 2011. This detailed budgetary information permits us to estimate a range of fiscal impacts using a variety of different assumptions. We find a large and negative fiscal impact from $500-$700 per pupil in our one urban school district and somewhat smaller, but still significant, fiscal externalities on the non-urban districts in our sample.
School Choice Programs and Location Choices of Private Schools
Economic Inquiry, forthcoming
This paper studies how the school choice policies that subsidize private school attendance using public funds affect the spatial distribution of private schools in the United States. Private school choice programs enacted between 1997 and 2010 are examined and linked to private school provision 2 years later. The paper finds that school choice policies lead to more private schools where the input to public schools is lower and the pool of students with special needs is larger. Yet the introduction of means-tested school choice programs does not necessarily lead private schools to locate in low-income neighborhoods.
The effects of computers and acquired skills on earnings, employment and college enrollment: Evidence from a field experiment and California UI earnings records
Robert Fairlie & Peter Bahr
Economics of Education Review, April 2018, Pages 51–63
This paper provides the first evidence on the earnings, employment and college enrollment effects of computers and acquired skills from a randomized controlled trial providing computers to entering college students. We matched confidential administrative data from California Employment Development Department (EDD)/Unemployment Insurance (UI) system earnings records, the California Community College system, and the National Student Clearinghouse to all study participants for seven years after the random provision of computers. The experiment does not provide evidence that computer skills have short- or medium-run effects on earnings. These null effects are found along both the extensive and intensive margins of earnings (although the estimates are not precise). We also do not find evidence of positive or negative effects on college enrollment. A non-experimental analysis of CPS data reveals large, positive and statistically significant relationships between home computers, and earnings, employment and college enrollment, raising concerns about selection bias in non-experimental studies.
Taking a Risk: Explaining the Use of Complex Debt Finance by the Chicago Public Schools
Amanda Kass, Martin Luby & Rachel Weber
Urban Affairs Review, forthcoming
In the decade leading up to the global crisis of 2007-2008, local governments in the United States used increasingly complex financial structures to underwrite major capital projects. These structures offered potentially lower borrowing costs while also carrying greater financial risk, and in most cases, the bond structures imploded when the crisis hit. Why did some local governments gravitate toward this part of the risk spectrum while others did not? This article develops several explanations for local government risk-taking with a case study of the Chicago Public Schools’ use of auction rate securities and interest rate swaps. We argue that the school district’s exceptional use of these instruments was due to administrators’ familiarity with these instruments, Chicago’s long history of using creative techniques to defer tax increases and service cuts, and lack of knowledge about the extent to which investment banks were propping up these securities markets.
Beetles: Biased Promotions and Persistence of False Belief
George Akerlof & Pascal Michaillat
Georgetown University Working Paper, December 2017
This paper develops a theory of promotion based on evaluations by the already promoted. The already-promoted show favoritism toward candidates with similar beliefs, just as beetles are more prone to eat the eggs of other species. With such egg-eating bias, false beliefs may not be eliminated by the promotion system. The main application is to scientific revolutions: when tenured scientists show favoritism toward tenure candidates with similar beliefs, science may not converge to the true paradigm. We extend the statistical concept of power to science: the power of the tenure test is the probability (absent any bias) of denying tenure to a scientist who adheres to the false paradigm, just as the power of any statistical test is the probability of rejecting a false null hypothesis. The power of the tenure test depends on the norms regarding the appropriate criteria to use in promotion and the empirical evidence available to apply these criteria. Economics and other social sciences are particularly at risk of capture by false paradigms because they have low power. Another application is to hierarchical organizations.
Yann Bramoullé & Lorenzo Ductor
Journal of Economic Behavior & Organization, forthcoming
We document strong and robust negative correlations between the length of the title of an economics article and different measures of scientific quality. Analyzing all articles published between 1970 and 2011 and referenced in EconLit, we find that articles with shorter titles tend to be published in better journals, to be more cited and to be more innovative. These correlations hold controlling for unobserved time-invariant and observed time-varying characteristics of teams of authors.
Saved by the Morning Bell: School Start Time and Teen Car Accidents
Contemporary Economic Policy, forthcoming
Adolescents today suffer from chronic sleep deprivation due to a combination of biological changes to the circadian clock and early morning school bell times. Many school districts are now considering delaying high school start times to accommodate the sleep schedules of teens. This paper explores whether such policy changes can have an unexpected impact on teen car accident rates. This impact could function both through a direct effect on teen sleep deprivation and indirectly through changes to the driving environment, that is, shifting the time and conditions under which teens commute to school. By focusing on late-night accidents and employing a difference-in-differences strategy using adult drivers as a control group, I find evidence of a persistent sleep deprivation mechanism. A 15-minute delay in school start time causes a significant decrease in late-night teen accidents of approximately 23%. However, I also find evidence of an opposing mechanism that is present during the morning commuting hours. A 15-minute delay in high school start time leads to a 21% increase in morning teen car accidents.
Snooze or Lose: High School Start Times and Academic Achievement
Jeffrey Groen & Sabrina Wulff Pabilonia
U.S. Bureau of Labor Statistics Working Paper, November 2017
Many U.S. high schools start classes before 8:00 A.M., yet research on circadian rhythms suggests that students' biological clocks shift to later in the day as they enter adolescence. Some school districts have moved to later start times for high schools based on the prospect that this would increase students' sleep and academic achievement. This paper examines the effect of high school start times on student learning. We use longitudinal data from the Child Development Supplement to the Panel Study of Income Dynamics (PSID-CDS) to conduct the first study of this relationship using a nationally-representative sample of students. We also use the CDS time diaries to explore the effects of high school start times on students' time allocation. Results indicate that female students who attend schools with later start times get more sleep and score higher on reading tests. Male students do not get more sleep when their schools start later and their test scores do not change.
Do Lessons in Nature Boost Subsequent Classroom Engagement? Refueling Students in Flight
Ming Kuo, Matthew Browning & Milbert Penner
Frontiers in Psychology, January 2018
Teachers wishing to offer lessons in nature may hold back for fear of leaving students keyed up and unable to concentrate in subsequent, indoor lessons. This study tested the hypothesis that lessons in nature have positive — not negative — aftereffects on subsequent classroom engagement. Using carefully matched pairs of lessons (one in a relatively natural outdoor setting and one indoors), we observed subsequent classroom engagement during an indoor instructional period, replicating these comparisons over 10 different topics and weeks in the school year, in each of two third grade classrooms. Pairs were roughly balanced in how often the outdoor lesson preceded or followed the classroom lesson. Classroom engagement was significantly better after lessons in nature than after their matched counterparts for four of the five measures developed for this study: teacher ratings; third-party tallies of “redirects” (the number of times the teacher stopped instruction to direct student attention back onto the task at hand); independent, photo-based ratings made blind to condition; and a composite index each showed a nature advantage; student ratings did not. This nature advantage held across different teachers and held equally over the initial and final 5 weeks of lessons. And the magnitude of the advantage was large. In 48 out of 100 paired comparisons, the nature lesson was a full standard deviation better than its classroom counterpart; in 20 of the 48, the nature lesson was over two standard deviations better. The rate of “redirects” was cut almost in half after a lesson in nature, allowing teachers to teach for longer periods uninterrupted. Because the pairs of lessons were matched on teacher, class (students and classroom), topic, teaching style, week of the semester, and time of day, the advantage of the nature-based lessons could not be attributed to any of these factors. It appears that, far from leaving students too keyed up to concentrate afterward, lessons in nature may actually leave students more able to engage in the next lesson, even as students are also learning the material at hand. Such “refueling in flight” argues for including more lessons in nature in formal education.
Student Employment and Persistence: Evidence of Effect Heterogeneity of Student Employment on College Dropout
Research in Higher Education, February 2018, Pages 88–107
This study explores how student employment affects college persistence and how these effects differ by individual likelihood of participating in student employment. I analyze data from the National Longitudinal Survey of Youth 1997 using propensity score matching and stratification-multilevel analysis. This study finds that engaging in intense work has deleterious effects on college persistence. However, these negative effects vary significantly according to likelihood of participation in intense work. The results indicate that employment has less negative impacts on completion for those most likely to participate in intense work, who are typically those from the most disadvantaged social backgrounds. This finding suggests that efforts to reduce the deleterious effects of intense work on persistence should be practiced with careful consideration for sub-populations that may have different reasons for and effects of student employment.
The School Experiences of Male Adolescent Offenders: Implications for Academic Performance and Recidivism
Adam Fine et al.
Crime & Delinquency, forthcoming
Adolescents with juvenile justice system experience may be enrolled into alternative schools to increase academic success or to reduce delinquency. This study used longitudinal data on a racially/ethnically diverse sample of 1,216 male, first-time adolescent offenders to examine how youthful offenders’ school experiences were associated with academic outcomes, school attitudes, and delinquency. Effects varied by domain in important ways. Youth who attended alternative schools generally fared better academically than youth who attended traditional schools. However, importantly, youth who attended alternative schools subsequently engaged in more delinquency and violent reoffending than youth in traditional schools. The findings indicate that disrupting normative schooling appears to be the most detrimental to youth outcomes across domains.