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The War on Poverty’s Human Capital Programs: K-12 Education

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1 The War on Poverty’s Human Capital Programs: K-12 Education
Elizabeth Cascio, Dartmouth Sarah Reber, UCLA June 2012

2 Elementary and Secondary Education Act
Signed April 11, 1965 Title I: Federal aid to fund programs for poor, educationally deprived children Directed to poor school districts $1 billion in ($7b, 2009$) Doubled federal aid for elementary/secondary education Per-pupil grants to districts ↑ linearly in child poverty rate

3 The Title I Program Restricted block grant from the federal government to local school districts Targeted good is educational services for poor children Initially, very little regulation of use of funds Over time, became highly regulated Most educators now think of Title I as related to particular educational interventions (pull-out programs), schools and students Evaluations of program consistent with this

4 Federal Grants in a Federalist System
Effects of Title I extended beyond grant-making TI receipt initially tied to desegregation Strengthened the hand of the Courts Consider desegregation-related benefits part of the legacy of TI TI receipt tied to accountability Experience of TI influenced design of state programs

5 Title I Evaluation Studies
Federally mandated evaluations Compare students participating in “Title I programs” to some comparison groups Generally find Title I not so effective Difficult to handle selection problem Gives benefits of Title I overall only if No Crowd-Out: Services received by treated students are new services No Spillovers: Non-participating students not affected Good reason to believe these don’t hold

6 Economists’ Approach Worry about all kinds of crowd out
Who can crowd out? State governments Local school districts Schools Where might the money go? Educational services for ineligible kids/schools Ineligible educational expenditure (e.g. capital) Private consumption (lower taxes) Funds may be nominally used for intended purposes but still not increase ed services for poor children Lots of anecdotal evidence of nominal mis-use of funds

7 Fiscal Federalism Studies
Feldstein (1978) Gordon (2004) Cascio, Gordon, and Reber (2012) Range of estimates, but all find evidence of economically significant crowd-out. What is the incidence? CGR find suggestive evidence of improvements in ed attainment for Southern whites

8 Summary of the Literature
Important to consider crowd-out! Few credible studies of Title I programs much less the program as a whole Desegregation appears to have benefitted blacks  TI like played some role Many other actors and policies also important A lot we don’t know

9 School Spending and Attainment: A Long View
How have the relationships among educational spending, educational attainment, poverty and income changed over time? Use state-level data from the 1950s to 2000s. Digest of Education Statistics Census/ACS

10 Summary Spending incredibly unequal across states and strongly negatively correlated with poverty No “South” effect  South is just poor Would have needed a much larger program to equalize Poverty less predictive and slope less steep over time Greater role for income Ed attainment gaps between high and low poverty states narrowing over time HS: Strong trend over whole period College Attendance: Consistent with role for TI











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