Using market valuation to assess public school spending

Lisa Barrow, Cecilia Elena Rouse

Research output: Contribution to journalArticlepeer-review

61 Scopus citations


We examine whether school expenditures are valued by potential residents and whether the current level of public school provision is inefficient by estimating the effect of state education aid on residential property values. We find evidence that, overall, state aid is valued by potential residents and that school districts do not overspend on education. However, we find that districts may overspend in areas where residents have fewer schooling options but find no difference in efficiency by the degree of district unionization. One interpretation of these results is that increased competition may reduce overspending on public schools in some areas.

Original languageEnglish (US)
Pages (from-to)1747-1769
Number of pages23
JournalJournal of Public Economics
Issue number9-10
StatePublished - Aug 2004

All Science Journal Classification (ASJC) codes

  • Finance
  • Economics and Econometrics


  • Competition
  • Education spending
  • Efficiency
  • School choice
  • Tiebout


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