Does Money Make the (Education) World Go ‘Round?

In the latest partnership with blog coauthor David Cappella of the John Glenn school at The Ohio State University, we tackle the question: what is the effect of public school funding on student achievement?

Education’s Great Lever: Tipping the Scale For More Funding

Pearce Edwards

“Since education is to this day both a tool of propaganda in the hands of dominant groups, and a means of emancipation for subject classes, it is easy to understand both the hopes and the fears of the privileged classes when they first began to yield the privilege of education.”                                       Reinhold Niebuhr, in Moral Man and Immoral Society (1932)

Profound social inequalities span across races and places in the United States of today, and result in increasing intergenerational poverty rates and hunger despite the great affluence and world leadership of our country. Free and universal public education is enshrined as a right in the United States, but not free, universal and equal public education. Remember that until the middle to latter part of the 20th century, nonwhite students received second class educations. These inequalities persist in the resources public schools receive, tying their hands and trapping students in poverty.

Other variables may affect the achievement of students attending low-income schools, but funding is the most important. The distribution of economic resources determines the fairness of a social and political system, with those who have access to power and privilege being those more likely to gain social status, wealth and success. Education is no exception, as the great theologian Reinhold Niebuhr observes that schooling can easily enrich only the powerful. Low-income schools therefore need the most resources to unlock their emancipating influence. This is in accordance with the Difference Principle of the philosopher John Rawls.

Funding is a positive correlate of educational opportunity, producing a stronger relationship with educational achievement than any other single reform. The most straightforward way to move the needle on the teacher quality market is to pay teachers more. Urban school districts such as Atlanta Public Schools recognize the per-dollar benefit of pay increases over other policy options. The Atlanta Journal-Constitution reported: “Reducing class sizes by five students citywide would cost $22 million; in comparison, the cost of a 3 percent pay raise would be $11 million.”

In addition to paying higher wages to increase the teacher labor supply, funding enhances infrastructure for instruction. A Gallup poll indicates 54% teachers in low-income schools felt their schools were not well prepared with the right technology for new Common Core computer-based tests. Low-income schools also require more funding than affluent districts because they have more students requiring support services and infrastructure, such as special education.

Even if policymakers were to seriously address the need to increase funding for wages and services in low-income schools, their policy tools would be limited. Inequalities in funding are often codified into law, custom and practice. Texas, for example, has a property-tax based school financing system which funnels money from tax zones back to those same districts. Frisco, Texas would have higher property valuation than Dallas or DeSoto and therefore receive more funding. The book Savage Inequalities details this process well, but in the realm of current events, an excellent example is Frisco ISD paying tens of millions a year to the Dallas Cowboys to use NFL facilities (not to mention the new economic impact which will be brought to wealthy Frisco instead of Dallas.)

Are there other ways to address educational inequality? Certainly. Much of the problem can be in early childhood learning, English-language learning families, mental health, nutrition and family transience for economic reasons. Yet, as I wrote in the case of child abuse, increasing funding for schools can provide at least in part, a tip on the scales of justice toward true fairness for all American children.

What is the Cost of Knowledge? Some Thoughts on the Debate about School Funding

David Cappella

A student learns and achieves. Why? The clearest link is to the teacher, the method employed, and the content. But this simplicity dissipates when you consider history and context. The student brings past experiences from their home and their past teachers. Peer interaction and how the student feels about being in class (atmosphere) also matter.

How does school funding impact these achievement factors? Money has the power to distribute and spur production of goods and services in the economy, but can it buy achievement? As economists like to quip, there is no such thing as a free lunch. Money is clearly necessary, but is money sufficient? Think about an ideal case, an inner city school is given funds to improve facilities, buy learning materials, and raise teacher salaries. Is this sufficient to improve achievement? Even if you rule out socioeconomic factors, uncertainty abounds: how specifically does renovating the building matter, how will kids react to new materials, what difference does a salary raise make if suburban schools give their teachers an equal raise in order to retain their higher quality teachers?

Fundamentally money, in mere quantity, will only impact student achievement to the extent that it gives teachers and administrators the necessary means to enhance the learning environment. But the actual student achievement enhancement is spurred by human action and is about the quality of the process. Learning emerges from a complex interaction of the physical environment (textbooks, building, etc.), the student, and how the teacher engages these dynamics in a meaningful and compelling manner.

What then are the policy implications? First, there are funding increases that can make incremental and significant differences for struggling schools: basic upkeep, curriculum, and the ability to retain staff with competitive salaries. These problems current laws do address but need to be updated since inequalities (even savage ones) persist between and within states. But there is a second deeper problem, no matter how much funding increases, scarce resources (like teacher quality) will flow to those that can pay more, maintaining imbalances. This is a much stickier problem.

As a student of economics my suggestion is to find better ways of measuring teacher quality, attaching this measurement to salaries (merit pay), and then giving struggling schools funding targeted specifically for hiring these high quality teachers. If we can better identify good teachers, then we can better direct them where they are most needed and reward them for their work. This applies to other components of achievement, find what matters most, measure it and target it—whether it be socioeconomic help to families or ensuring all schools have up to date technology.

Our expectations for money’s effect on achievement needs to be tempered by an understanding of how administrators use these resources to precipitate the complex process of learning. Politicians are often lambasted for throwing money at problems, policy implementers have the more difficult task of allocating money effectively. We live in perhaps the most affluent society in history, giving schools adequate resources should not be a practical barrier, but giving our students equality of opportunity will require innovative and strategic use of money.

Knowledge may be costly, but ultimately it flourishes in the rich soil of imagination.

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