Fiscal Effects of Budget Referendums: Evidence from New York School Districts

Abstract:     
This paper provides empirical evidence on how budget referendums affect school inputs by taking advantage of an exogenous enactment of budget referendums for small city school districts (SCSDs) in New York State in 1998. The paper shows that SCSDs reduce instructional spending and increase student-teacher ratios while preserving administrative spending in response to budget referendums. These empirical findings are obtained by difference-in-differences estimations on data processed with propensity score matching, and the results are robust to sensitivity analysis.

Number of Pages in PDF File: 19

Keywords: Budget referendums, School spending, Propensity score matching, Difference-in-differences, Small city school districts

JEL Classification: H72, D72

working papers series