How and Why Money Matters in Schools (one more time – updated)

School Finance 101

This post is taken from a forthcoming report in which I summarize literature related to state school finance reforms and explore relationships between changing distributions of funding and distributions of tangible classroom level resources. The newly released Jackson, Johnson and Persico NBER paper speaks to similar issues and is included in the discussion that follows:


In a comprehensive review of literature addressing the question “Does Money Matter in Education?” in 2012, Baker concluded:

            To be blunt, money does matter. Schools and districts with more money clearly have greater ability to provide higher-quality, broader, and deeper educational opportunities to the children they serve. Furthermore, in the absence of money, or in the aftermath of deep cuts to existing funding, schools are unable to do many of the things they need to do in order to maintain quality educational opportunities. Without funding, efficiency tradeoffs and innovations being broadly endorsed are…

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