Funding Adequacy: Does Spending Matter?

Published January 1, 1997

In its 1990 lawsuit against the State of Illinois, The Committee for Education Rights, a coalition of more than sixty school districts around the state, including the Chicago Public Schools, contended that the level of per-pupil spending in a school district determines the quality of education delivered to students in that district. A student is therefore deprived of a quality education if he or she lives in a district that has a low level of per-pupil spending. In the 1993-94 school year, per-pupil spending ranged from $2,617 to $14,525.

The coalition’s position assumes that differences in per-pupil spending levels determine the quality of education delivered. In this assumption, the coalition is joined by such groups as the MacArthur Foundation, whose recent publication Mapping the Future asks, Do funding levels make a difference in the quality of education? Unfortunately, the Foundation then fudges the answer: “Although this question is the subject of debate, there is no question that student-teacher ratios, availability of new technology, quality of science labs, availability of art/music classes and extracurricular activities are all significantly affected by funding.”

Actually, the “debate” to which the MacArthur study refers is over. Repeated statistical analyses show little or no correlation between test scores and spending levels. Eric Hanushek, a professor of economics and public policy at the University of Rochester, examined 65 studies of the relationship between spending and student achievement. He concluded that “there is no strong or systematic relationship between school expenditures and student achievement.”

In a forthcoming book from the Brookings Institution, titled Does Money Matter? The Effect of School Resources on Student Achievement and Adult Success, editor Gary Burtless summarizes the results of the debate as follows: “Statistical evidence and recent historical experience suggest . . . that school performances are unlikely to be improved solely by investing extra money in the nation’s schools. Increased spending on school inputs without any change in the current arrangements for managing schools offers little promise of improving either student performance or adult earnings.”