Are School Reopening Decisions Related to Funding? Evidence from Over 12,000 Districts During the COVID-19 Pandemic

Abstract

In theory, public school districts with more funding might be more likely to reopen in person if resources are a primary driver of their reopening decisions during the Covid-19 pandemic. However, it is also possible that these decisions are influenced by other factors including political partisanship, incentive structures, and special interests. Using data on over 12,000 school districts in the United States, we quantify the relationship between public school revenues and expenditures per student and their reopening decisions in Fall 2020. Our preferred statistical specifications, which compare school districts in the same county, suggest that there is no relationship between funding and the decision to make classes fully remote. If anything, we find a positive relationship when we compare districts in the same state, suggesting that the schools that went fully remote were financially better off than their in-person counterparts in the same state. These results are consistent across various analytic techniques and specifications controlling for district size and a rich set of county-level demographics including political partisanship, Covid-19 risk, household income, educational attainment, and the race and age distributions. We also find that increases in the share of remote school districts in a state are associated with increases in the growth of counselors and social workers, relative to 2019, even after controlling for the overall employment decline in the state. In sum, our results not only find no evidence that additional stimulus funding for K-12 public schools is necessary or sufficient for them to reopen in person, but also that there are unintended consequences of opening remotely on child mental health.

Keywords: school reopening, school closures, COVID-19, school funding, economics of education

JEL Classification: I28, I20