School Spending and Student Outcomes: Evidence from Revenue Limit Elections in Wisconsin
65 Pages Posted: 6 Aug 2019 Last revised: 18 May 2020
Date Written: November 5, 2019
This study examines the impact of school spending on student outcomes. State-imposed revenue limits cap the total amount of revenue that a school district in Wisconsin can raise, unless the district holds a local referendum asking voters to exceed the cap. Importantly, Wisconsin law requires districts to hold separate referenda for operational and capital expenditures, which allows for estimating their independent effects. Leveraging close elections in a dynamic regression discontinuity framework, I find that increases in operational spending have substantial positive effects on test scores, dropout rates, and postsecondary enrollment, but additional capital expenditures have little impact.
Keywords: School Spending, Student Outcomes, Dynamic Regression Discontinuity
JEL Classification: H0, H41, H75, I20, I22, I24, I28, J24
Suggested Citation: Suggested Citation