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Does Money Still Matter? Attainment and Earnings Effects of Post-1990 School Finance Reforms

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  • Jesse Rothstein
  • Diane Whitmore Schanzenbach
Abstract
In two 1992 papers, Card and Krueger used labor market outcomes to study the productivity of school spending. Following their lead, we examine the effects of post-1990 school finance reforms on students’ educational attainment and labor market outcomes. Using a state-by-cohort panel design, we find that reforms increased high school completion and college-going, concentrated among Black students and women, and raised annual earnings. The reforms also increased the return to education, particularly for Black students and men, driven by the return to high school.

Suggested Citation

  • Jesse Rothstein & Diane Whitmore Schanzenbach, 2022. "Does Money Still Matter? Attainment and Earnings Effects of Post-1990 School Finance Reforms," Journal of Labor Economics, University of Chicago Press, vol. 40(S1), pages 141-178.
    • Handle: RePEc:ucp:jlabec:doi:10.1086/717934
    DOI: 10.1086/717934
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    Cited by:

    1. Danielle V. Handel & Eric A. Hanushek, 2024. "Contexts of Convenience: Generalizing from Published Evaluations of School Finance Policies," Evaluation Review, , vol. 48(3), pages 461-494, June.
    2. Erdal Asker & Eric J. Brunner & Stephen L. Ross, 2022. "The Impact of School Spending on Civic Engagement: Evidence from School Finance Reforms," Working papers 2022-16, University of Connecticut, Department of Economics.
    3. Lorenzo Cappellari & Daniele Checchi & Marco Ovidi, 2022. "The effects of schooling on cognitive skills: evidence from education expansions," DISCE - Working Papers del Dipartimento di Economia e Finanza def122, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    4. Alex Combs & Erin Troland, 2023. "The Role of Property Assessment Oversight in School Finance Inequality," Finance and Economics Discussion Series 2023-024, Board of Governors of the Federal Reserve System (U.S.).
    5. Committee, Nobel Prize, 2021. "Answering causal questions using observational data," Nobel Prize in Economics documents 2021-2, Nobel Prize Committee.
    6. Chauvin, Juan Pablo, 2024. "Local Education Spending and Migration: Evidence from a Large Redistribution Program," IDB Publications (Working Papers) 13497, Inter-American Development Bank.
    7. Erdal Asker & Eric Brunner & Stephen L. Ross, 2022. "The Impact of School Spending on Civic Engagement: Evidence from School Finance Reforms," Working Papers 2022-041, Human Capital and Economic Opportunity Working Group.

    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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