Current Issue: Volume 15, Issue 1, Winter 2020

Education Finance and Policy - Volume 15, Issue 1, Winter 2020

Presidential Essay

Maximizing Research Use in the World We Actually Live In: Relationships, Organizations, and Interpretation. Carrie Conaway. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 1–10

When I started my job as research director of the Massachusetts Department of Elementary and Secondary Education twelve years ago, I thought my job was to figure out what worked. My agency was just beginning to have access to new and exciting longitudinal data on students and educators. I envisioned that I'd use those data along with strong designs for causal inference to determine which programs and policies were working and which were not. Once we knew those answers, I figured, we would get better policy that would improve outcomes for Massachusetts’ students.


Vocational and Career Tech Education in American High Schools: The Value of Depth Over Breadth. Daniel Kreisman and Kevin Stange. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 11–44

Vocational education is a large part of the high school curriculum, yet we have little understanding of what drives vocational enrollment or whether these courses help or harm early careers. To address this deficiency, we develop a framework for curriculum choice, taking into account ability and preferences for academic and vocational work. We test model predictions using detailed transcript and earnings information from the National Longitudinal Survey of Youth (1997). Our results are twofold. First, students positively sort into vocational courses, suggesting that the belief that low-ability students are funneled into vocational coursework is unlikely true. Second, we find higher earnings among students taking more upper-level vocational courses—a nearly 2 percent wage premium for each additional year, yet we find no gain from introductory vocational courses. These results suggest: (1) policies limiting students' ability to take vocational courses may not be welfare-enhancing, and (2) the benefits of vocational coursework accrue to those who focus on depth over breadth.


How Does an Accountability Program that Targets Achievement Gaps Affect Student Performance?. Steven W. Hemelt and Brian A. Jacob. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 45–74

In 2011, the U.S. Department of Education granted states the opportunity to apply for waivers from the core requirements of the No Child Left Behind Act. In exchange, many states implemented systems of differentiated accountability that included a focus on schools with the largest achievement gaps between subgroups of students. We use administrative data from Michigan in a series of regression-discontinuity analyses to study the effects of these school reforms on schools and students. We find some evidence that targeting schools for such reforms led to small, short-run reductions in the within-school math achievement gap. However, these reductions were driven by stagnant performance of lower-achieving students alongside declines in the performance of their higher-achieving peers. These findings serve as a cautionary tale for the capacity of the accountability provisions embedded in the recent reauthorization of No Child Left Behind, the Every Student Succeeds Act, to meaningfully improve student and school outcomes.


The Effects of School Reform under NCLB Waivers: Evidence from Focus Schools in Kentucky. Sade Bonilla and Thomas S. Dee. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 75–103

Under waivers to the No Child Left Behind Act, the federal government required states to identify schools where targeted subgroups of students have the lowest achievement and to implement reforms in these “Focus Schools.” In this study, we examine the Focus School reforms in the state of Kentucky. The reforms in this state are uniquely interesting for several reasons. One is that the state developed unusually explicit guidance for Focus Schools centered on a comprehensive school-planning process. Second, the state identified Focus Schools using a “super subgroup” measure that combined traditionally low-performing subgroups into an umbrella group. This design feature may have catalyzed broader whole-school reforms and attenuated the incentives to target reform efforts narrowly. Using regression discontinuity designs, we find that these reforms led to substantial improvements in school performance, raising math proficiency rates by 17 percent and reading proficiency rates by 9 percent.


Disentangling the Effects of the School Year from the School Day: Evidence from the TIMSS Assessments. Derek Wu. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 104–135

Schools often have to decide between extending the length of the school year or the school day. This paper examines the effects of changes in the distribution of instructional time on eighth-grade student achievement through a methodological framework that disaggregates total yearly instructional time into separate inputs for days per year and hours per day. This study's dataset brings together nearly 900,000 student observations across eighty countries and four quadrennial testing cycles of the Trends in International Mathematics and Science Study (TIMSS) Assessments (1995–2007). I find that the positive effects of instructional time on student achievement are driven largely by the length of the school day and not by the length of the school year, with diminishing marginal returns to the former. Socioeconomically underprivileged students are most likely to realize gains from a longer school day. Furthermore, isolating the amount of instructional time spent on TIMSS-tested subjects from the rest of the school day reveals spillover effects from time spent in non-tested subjects that are especially meaningful for underprivileged students. In contrast, the effects of time spent in tested subjects are more homogeneous across student groups.


Supplement or Supplant? Estimating the Impact of State Lottery Earmarks on Higher Education Funding. Elizabeth Bell, Wesley Wehde, and Madeleine Stucky. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 136–163

In the wake of declining state support for higher education, many state leaders have adopted lottery earmark policies, which designate lottery revenue to higher education budgets as an alternative funding mechanism. However, despite the ubiquity of lottery earmarks for higher education, it remains unclear whether this new source of revenue serves to supplement or supplant state funding for higher education. In this paper, we use a difference-in-differences design for the years 1990–2009 to estimate the impact on state appropriations and state financial aid levels of designating lottery earmark funding to higher education. Main findings indicate that lottery earmark policies are associated with a 5 percent increase in higher education appropriations, and a 135 percent increase in merit-based financial aid. However, lottery earmarks are also associated with a decrease in need-based financial aid of approximately 12 percent. These findings have serious distributional implications that should be considered when state lawmakers adopt lottery earmark policies for higher education.


Does Broad-Based Merit Aid Improve College Completion? Evidence from New Mexico's Lottery Scholarship. Christopher Erwin and Melissa Binder. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 164–190

We use the natural experiment of a state lottery scholarship to measure the effect of generous financial aid on graduation rates at New Mexico's flagship public university. During the study period, the scholarship program paid full tuition for eight semesters for any state resident earning a 2.5 grade point average in their first semester at any public two-year or four-year college. We find a significant positive completion effect of 10 percentage points (17.9 percent) for academically well-prepared students that is offset by a large negative effect of 11.6 percentage points (38.8 percent) for less-prepared students. We posit that the scholarship program, which effectively erased the difference in tuition at two- and four-year colleges, may have induced weaker students to take their chances on a more prestigious, yet riskier, academic path.


Policy Brief

The Fiscal Externalities of Charter Schools: Evidence from North Carolina. Helen F. Ladd and John D. Singleton. Education Finance and Policy Winter 2020, Vol. 15, No. 1, pp. 191–208

A significant criticism of the charter school movement is that funding for charter schools diverts money away from traditional public schools. The magnitude of such adverse fiscal externalities depends in part on the nature of state and local funding policies. In this paper, we examine the fiscal effects of charter schools on both urban and nonurban school districts in North Carolina. We base our analysis on detailed balance sheet information for a sample of school districts that experienced substantial charter growth since the statewide cap on charters was raised in 2011. We find a large and negative fiscal impact in excess of $500 per traditional public school pupil in our one urban school district, which translates into an average fiscal cost of about $3,600 for each student enrolled in charter schools. We estimate comparable to somewhat larger fiscal externalities per charter school pupil for two nonurban districts.

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