Do School Spending Cuts Matter? Evidence from The Great Recession

Do School Spending Cuts Matter? Evidence from the Great Recession

American Economic Journal Economic Policy ◽

10.1257/pol.20180674 ◽

2021 ◽

Vol 13 (2) ◽

pp. 304-335

Author(s):

C. Kirabo Jackson ◽

Cora Wigger ◽

Heyu Xiong

Keyword(s):

Public Schools ◽

Great Recession ◽

Test Scores ◽

Budget Cuts ◽

The Great Recession ◽

College Going ◽

The Business Cycle ◽

The Impact ◽

Spending Cuts ◽

School Spending

During the Great Recession, national public school per-pupil spending fell by roughly 7 percent and persisted beyond the recovery. The impact of such large and sustained education funding cuts is not well understood. To examine this, first, we document that the recessionary drop in spending coincided with the end of decades-long national growth in both test scores and college-going. Next, we show that this stalled educational progress was particularly pronounced in states that experienced larger recessionary budget cuts for plausibly exogenous reasons. To isolate budget cuts that were unrelated to (i) other ill-effects of the recession or (ii) endogenous state policies, we use states’ historical reliance on state-appropriated funds (which are more sensitive to the business cycle) to fund public schools interacted with the timing of the recession as instruments for reductions in school spending. Cohorts exposed to these spending cuts had lower test scores and lower college-going rates. The spending cuts led to larger test score gaps by income and race. (JEL E32, H52, H75, I21, I28, J15)

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The Great Recession and Public Education

Education Finance and Policy ◽

10.1162/edfp_a_00245 ◽

2019 ◽

Vol 14 (2) ◽

pp. 298-326 ◽

Cited By ~ 13

Author(s):

William N. Evans ◽

Robert M. Schwab ◽

Kathryn L. Wagner

Keyword(s):

Public Education ◽

Great Recession ◽

Property Tax ◽

State Governments ◽

School Employees ◽

The Great Recession ◽

The Impact ◽

Public Education Finance ◽

Work First ◽

School Spending

We examine the impact of the Great Recession on public education finance and employment. Five major themes emerge from our work. First, nearly 300,000 school employees lost their jobs. Second, schools that were heavily dependent financially on state governments were particularly vulnerable to the recession. Third, local revenues from the property tax actually increased during the recession, primarily because millage rates rose in response to declining property values. Fourth, inequality in school spending rose sharply during the Great Recession. We argue, however, that we need to be very cautious about this result. School spending inequality has risen steadily since 2000; the trend in inequality we see in the 2008–13 period is very similar to the trend we see in the 2000–08 period. Fifth, the federal government's efforts to shield education from some of the worst effects of the recession achieved their major goal.

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Financial Crisis and Europe: An eventual post-scenario analysis

Scholedge International Journal of Business Policy & Governance ISSN 2394-3351 ◽

10.19085/journal.sijbpg030101 ◽

2016 ◽

Vol 3 (1) ◽

pp. 1

Author(s):

Mike Susan

Keyword(s):

United Kingdom ◽

Financial Crisis ◽

Scenario Analysis ◽

Great Recession ◽

Critical Position ◽

The Great Recession ◽

The United Kingdom ◽

Spending Cuts

It is a typical abstain of political strategists that you ought not release a decent emergency to squander. Seven years on from the beginnings of the worldwide money related emergency, we can make an evaluation of whether that saying was taken after. The reaction in Europe was generally one of expanded government obtaining, counterbalance by bundles of expense rises and spending cuts. The methodologies in France, Germany, Ireland, Italy, Spain and the United Kingdom have been in a few ways comparative, however essential contrasts in a critical position of assessments and cuts, in the zones focused on and in the sorts of family units influenced have permitted us to make some unmistakable inferences about the effect of the Great Recession.

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