New Evidence on Class Size Effects: A Pupil Fixed Effects Approach*
32 Pages Posted: 10 Feb 2012
Date Written: April 2012
The impact of class size on student achievement remains a thorny question for educational decision makers. Meta‐analyses of empirical studies emphasize the absence of class‐size effects but detractors have argued against such pessimistic conclusions because many of the underlying studies have not paid attention to the endogeneity of class size. This article uses a stringent method to address the endogeneity problem using Trends in International Mathematics and Science Study data on 47 countries. We measure the class size effect by relating the difference in a student's achievement across subjects to the difference in his/her class size across subjects. This (subject‐differenced) within‐pupil achievement production function avoids the problem of the non‐random matching of children to specific schools, and to classes within schools. The results show a statistically significant negative effect of class size in 14 countries, but the effect size is small in most cases. Several robustness tests are carried out, including control for students’ subject‐specific ability and subject‐specific teacher characteristics, and correction for possible measurement error. Thus, our approach to addressing the endogeneity problem confirms the findings of meta‐analyses that find little support for class size effects. Additionally, we find that class size effects are smaller in countries with higher teacher quality.
JEL Classification: I21, H52
Suggested Citation: Suggested Citation