Joshua Hyman. Forthcoming. "Does Money Matter in the Long Run? Effects of School Spending on Educational Attainment," American Economic Journal: Economic Policy.
This paper measures the effect of increased primary school spending on students' college enrollment and completion. Using student-level panel administrative data, I exploit variation in the school funding formula imposed by Michigan's 1994 school finance reform, Proposal A. Students exposed to $1,000 (10 percent) more spending were 3 percentage points (7 percent) more likely to enroll in college and 2.3 percentage points (11 percent) more likely to earn a postsecondary degree. The effects were concentrated among districts that were urban and suburban, lower-poverty, and higher-achieving at baseline. Districts targeted the marginal dollar toward schools serving less-poor populations within the district.