Using market valuation to assess the importance and efficiency of public school spending

Lisa Barrow and Cecilia Elena Rouse

No WP-00-4, Working Paper Series from Federal Reserve Bank of Chicago

Abstract: In this paper we take a \"market-based\" approach to examine whether increased school expenditures are valued by potential residents and whether the current level of public school provision is inefficient. We do so by employing an instrumental variables strategy to estimate the effect of state education aid on residential property values. We find evidence that, on average, additional state aid is valued by potential residents and that school districts appear to spend efficiently or, if anything, underspend. We also find that school districts spend less efficiently in areas in which they face little or no competition from other public schools, in large districts, and in areas in which residents are poor or less educated. One interpretation of these results is that increased competition has the potential to increase school efficiency in some areas.

Keywords: Education (search for similar items in EconPapers)
Date: 2000
New Economics Papers: this item is included in nep-edu and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.chicagofed.org/digital_assets/publicati ... s/2000/wp2000_04.pdf (application/pdf)

Related works:
Working Paper: Using Market Valuation to Assess the Importance and Efficiency of Public School Spending (2000)
Working Paper: Using Market Valuation to Assess the Importance and Efficiency of Public School Spending (2000)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fip:fedhwp:wp-00-4

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in Working Paper Series from Federal Reserve Bank of Chicago Contact information at EDIRC.
Bibliographic data for series maintained by Lauren Wiese ().