The Impact of Early Investments in Urban School Systems in the United States

Ethan Schmick () and Allison Shertzer

No 26-15, Working Papers from Federal Reserve Bank of Philadelphia

Abstract: Cities in the United States dramatically expanded spending on public education after World War I, with the average urban school district increasing per pupil expenditures by over 70 percent by 1924. We provide the first evaluation of these unprecedented investments in public education using a new dataset and plausibly exogenous growth in school spending generated by anti-German sentiment. We find that school resources significantly increased educational attainment and wages later in life, particularly for less advantaged children. Increases in expenditures can explain about 40 percent of the sizable increase in educational attainment of cohorts born between 1895 and 1913.

Keywords: school spending; returns to educational resources (search for similar items in EconPapers)
JEL-codes: H75 I22 N32 (search for similar items in EconPapers)
Pages: 66
Date: 2026-03-16
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Working Paper: The Impact of Early Investments in Urban School Systems in the United States (2019)
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DOI: 10.21799/frbp.wp.2026.15

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