Money and Schools

DOUGLAS LAMDIN

April 22, 1993|By DOUGLAS LAMDIN

Those who equate more school spending with better public education may be misled and misleading us.

Real spending per pupil for kindergarten through 12th grade education has nearly trebled since 1960. It was $1,885 then, $3,144 in 1970, $4,188 in 1980 and $5,399 in 1990. Certainly, students are not three times better educated: The question is whether they are getting a better education at all.

Behind these numbers are related figures. Between 1960 and 1990 the number of teachers per 100 pupils rose by 53 percent (from about 4 to nearly 6), and total staff per 100 pupils increased by 110 percent (from about 5 to nearly 11). The average public-school teacher earned $33,015 in 1991, an increase of 43 percent from the 1960 level, after adjusting for inflation.

Reports of disappointing performances of U.S. students relative to their foreign counterparts are commonplace. Are we not keeping up due to lack of financial support for public education? A study done with 1988 data (adjusted for exchange rates) shows that the U.S. spent 75 percent more per student than Japan, 77 percent more than West Germany, 39 percent more than Britain and 73 percent more than France.

A related issue is not the level of spending but how the spending is distributed. A best-seller by Jonathan Kozol compared two ends of the spectrum in school spending in a series of anecdotes. Not surprisingly, he found that some schools are inexcusably awful, while others are well supported. The vast majority of schools fall between the extremes, however, and that is also where public policies are shaped.

Legal rulings in some states, such as the Serrano case in California, have mandated that public spending per student must be essentially equal in all school districts, irrespective of the taxes generated in the districts. In Maryland, a similar court challenge is being considered.

Would reducing or even eliminating the variance in expenditure per pupil across the state change the level or variance of educational achievement of students in the state? Accumulated research suggests it would not.

Professor Eric Hanushek at the University of Rochester, in the 1986 Journal of Economic Literature, summarizes an enormous body of research (147 studies) that collectively shows that differences in expenditure per pupil, class size, teacher salary and similar pecuniary measures are essentially irrelevant in explaining the variation in student achievement -- once the socioeconomic background of the students is factored in.

To be more concrete, students in Montgomery County perform much better than those in Baltimore. Is it because Montgomery county spends $7,213 per pupil and the city spends $4,614? No. Students in Carroll and Frederick counties perform similarly to those in Montgomery County. Carroll County spends $4,736 per pupil, and Frederick County spends $4,853 per pupil.

It is worth noting that years after the leveling of spending across districts in California, a corresponding reduction in the variance in student achievement has yet to materialize.

Efforts to reallocate resources among school districts in Maryland, beyond that which already occurs, should be met with some questions. Is this being done in the expectation of improving student performance in the have-not districts? If so, we had better hope that those studies just cited are wrong -- or at least do not apply in Maryland. Is this being done to make us perceive some sense of equity? If so, then how much are we willing to pay for this perception?

Should all schools be funded at Montgomery County levels or Frederick County levels? Can we afford the former? Will the latter be imposed on Montgomery County (or Howard or Baltimore Counties?). California's notorious Proposition 13 tax revolt followed the Serrano decision. It may have been not a coincidence but a response to the decision by wealthier and politically more astute Californians seeking to save themselves from anticipated huge tax increases. If you expected all public school systems in Maryland, from Garrett County to Baltimore to Somerset County, might soon be entitled to resources like those in Montgomery County, would you expect your taxes to rise a trifle?

I have examined data from the 1990 Citizens Planning and Housing Authority report on Baltimore city elementary schools. The performance of students on standardized tests of reading and math skills varied enormously. This variable performance occurs within the same school system with presumably the same resources.

But in fact the presumption is wrong. Per-pupil expenditure varies among the city public elementary schools: the highest is double the lowest, and average class size ranges from a low of 20 to a high of more than 40. Moreover, I found that once the economic status of the students is held constant, pupils in larger classes with less expenditure per student do better on the standardized tests.

If we care about the quality of student education, rather than the amount we spend, the current and foreseeable budget shortfalls may be a blessing in disguise. Policy makers may now look for ways to improve the system without additional funding, such as focusing on the crucial role of parental involvement, curriculum changes, changes in teacher training or a decentralized and competitive school system rather than a one that is bureaucratic and monopolistic.

These are important issues. We can look at them more seriously once we divert attention from pecuniary issues that may be irrelevant.

Douglas Lamdin is professor of economics at the University of Maryland Baltimore County.

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