Does School Funding Matter? An Examination of How District Level Funding Affects Student Achievement

Abstract

I study the relationship between district level expenditure per pupil and student achievement across 10 urban districts across the United States by using consistent achievement data provided by the National Assessment of Educational Progress. Using a district fixed-effects linear regression model, I find that there is no consistent relationship between district level funding and student achievement. I also examine the effect of funding on the achievement of different groups of students characterized by race, gender, income level, and English-language ability. I find that funding funding does not affect students differently by race, gender, and income. English-language learners do experience a greater effect of funding in grade 8 than grade 4, implying that school resources are more effective for these students when they have a better grasp on the language. Overall, the implied effects of school funding on student achievement in urban school districts are small.