 Does class size matter? How, and at what cost?Desire Kedagni, Kala Krishna (), Rigissa Megalokonomou and Yingyan Zhao European Economic Review, 2021, vol. 133, issue C Abstract: Using Greek high quality administrative data we show that class size has a hump shaped effect on achievement whereas most of the literature assumes linearity. We then embed our estimates for this relationship in a dynamic structural model with costs of hiring and firing. We find that class sizes around 19 maximize the attainment, and the existing costs result in an average class size of 22–23 being chosen. Firing costs are about the same size as hiring costs consistent with the presence of unions. Reducing firing costs to zero raises class size by 4–6 students and reduces achievement by 0.8 to 1.2 GPA points. Reducing hiring costs to zero reduces class size by 3–5 students and increases GPA by 0.3 GPA points. Raising wages by 50%, class size increases by 2 students and GPA falls by 0.3 GPA points suggesting that unions (which raise salaries and firing costs) do raise class size, but have a small effect on achievement. We show that class size caps are costly, and more so for small schools, even when they are set at levels well above the average class size. Keywords: Class size; Student performance; Adjustment costs; Dynamic model (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:133:y:2021:i:c:s0014292121000179 DOI: 10.1016/j.euroecorev.2021.103664 Access Statistics for this article European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer More articles in European Economic Review from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.