School District Operational Spending and Student Outcomes: Evidence From Tax Elections in Seven States

We use close tax elections to estimate the impact of school district funding increases on operational spending and student outcomes across seven states. Districts with passing levies directed new revenue toward support services and instructor salaries but did not increase teacher staffing levels. These districts eventually realized gains in student achievement and attainment. Our preferred estimates imply that increasing operational spending by $1000 per pupil increased test scores by approximately 0.15 of a standard deviation and graduation rates by approximately 9 percentage points. There is some evidence of diminishing returns, as these effects are driven by districts below the median in spending per pupil. Based on research linking academic outcomes to earnings, we conclude that these spending increases were likely cost-effective.

“School District Operational Spending and Student Outcomes: Evidence from Tax Elections in Seven States” (w/ Carolyn Abott, Vladimir Kogan, and Zachary Peskowitz), Journal of Public Economics, 183: 104142, 2020