Demographic Structure and the Political Economy of Public Education

39 Pages Posted: 29 Oct 1996 Last revised: 2 Oct 2010

See all articles by James M. Poterba

James M. Poterba

National Bureau of Economic Research (NBER); Massachusetts Institute of Technology (MIT) - Department of Economics

Date Written: July 1996

Abstract

This papers examines the relationship between demographic structure and the level of government spending on K-12 education. Panel data for the U.S. states over the 1960-1990 period suggests that an increase in the fraction of elderly residents in a jurisdiction is associated with a significant reduction in per child educational spending. This reduction is particularly large when the elderly residents and the school-age population are from different racial groups. Variation in the size of the school-age population does not result in proportionate changes in education spending, so students in states with larger school-age populations receive lower per-student spending than those in states with smaller numbers of potential students. These results provide support for models of generational competition in the allocation of public sector resources. They also suggest that the effect of cohort size on government-mediated transfers must be considered in analyzing how cohort size affects economic well-being.

Suggested Citation

Poterba, James M., Demographic Structure and the Political Economy of Public Education (July 1996). NBER Working Paper No. w5677. Available at SSRN: https://ssrn.com/abstract=4368

James M. Poterba (Contact Author)

National Bureau of Economic Research (NBER) ( email )

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Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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