Beyond the Classroom: The Implications of School Vouchers for Church Finances

Daniel M. Hungerman, Kevin Rinz and Jay Frymark

No 23159, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Governments have used vouchers to spend billions of dollars on private education; much of this spending has gone to religiously-affiliated schools. We explore the possibility that vouchers could create a financial windfall for religious organizations operating private schools and in doing so impact the spiritual, moral, and social fabric of communities. We use a dataset of Catholic-parish finances from Milwaukee that includes information on both Catholic schools and the parishes that run them. We show that vouchers are now a dominant source of funding for many churches; parishes in our sample running voucher-accepting schools get more revenue from vouchers than from worshipers. We also find that voucher expansion prevents church closures and mergers. Despite these results, we fail to find evidence that vouchers promote religious behavior: voucher expansion causes significant declines in church donations and church spending on non-educational religious purposes. The meteoric growth of vouchers appears to offer financial stability for congregations while at the same time diminishing their religious activities.

JEL-codes: H4 I2 Z12 (search for similar items in EconPapers)
Date: 2017-02
New Economics Papers: this item is included in nep-edu and nep-ure
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Published as Daniel M. Hungerman & Kevin Rinz & Jay Frymark, 2019. "Beyond the Classroom: The Implications of School Vouchers for Church Finances," The Review of Economics and Statistics, vol 101(4), pages 588-601.

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Journal Article: Beyond the Classroom: The Implications of School Vouchers for Church Finances (2019)
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