Does Additional Spending Help Urban Schools? An Evaluation Using Boundary Discontinuities

48 Pages Posted: 28 Jan 2012

See all articles by Stephen Gibbons

Stephen Gibbons

London School of Economics & Political Science (LSE) - Department of Geography and Environment

Sandra McNally

University of Surrey; London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP); IZA Institute of Labor Economics

Martina Viarengo

London School of Economics & Political Science (LSE); IZA Institute of Labor Economics; Harvard University - Harvard Kennedy School (HKS), Women and Public Policy Program

Abstract

Improving the educational attainment of disadvantaged students in urban schools is a priority for policy worldwide, but existing research is equivocal about the effectiveness of additional funding for achieving this objective. This study exploits anomalies in the spatial dimension of school funding policy in England to provide new evidence on this question. An "area cost adjustment" and other aspects of the formula that allocates central grants to Local Authorities (school districts) means that neighbouring schools with similar intakes, operating in the same labour market and facing the same prices for inputs can receive very different incomes. We find that these funding disparities give rise to sizeable differences in pupil attainment in national tests at the end of primary school. This shows that school resources have an important role to play in improving educational attainment. The results have direct implications for the current "Pupil Premium" policy in England.

Keywords: urban schools, education, resources

JEL Classification: R0, I21, H52

Suggested Citation

Gibbons, Stephen and McNally, Sandra and Viarengo, Martina, Does Additional Spending Help Urban Schools? An Evaluation Using Boundary Discontinuities. IZA Discussion Paper No. 6281. Available at SSRN: https://ssrn.com/abstract=1994344

Stephen Gibbons (Contact Author)

London School of Economics & Political Science (LSE) - Department of Geography and Environment ( email )

Houghton Street
London, WC2A 2AE
United Kingdom
[44] (0)20 7955 6245 (Phone)
[44] (0)20 7955 7773 (Fax)

HOME PAGE: http://www.lse.ac.uk/people/s.gibbons@lse.ac.uk/

Sandra McNally

University of Surrey ( email )

Guildford
Guildford, Surrey GU2 5XH
United Kingdom

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE
United Kingdom

IZA Institute of Labor Economics

Schaumburg-Lippe-Str. 7 / 9
Bonn, D-53072
Germany

Martina Viarengo

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Harvard University - Harvard Kennedy School (HKS), Women and Public Policy Program ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States
617-496-4786 (Phone)

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