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  • Spring 2022

Articles – Volume 23, Issue 1, Spring, 2022

Education reforms and convergence in student performance: Evidence from Arkansas

By:  Huiqiong Duan, Mavuto Kalulu, Xuechen Gao, & Weici Yuan

Abstract Accordion Closed

Arkansas launched a series of far-reaching reforms in 2003 and 2004 aimed at promoting equity and adequacy of education. The education funding system has since directed considerably more school resources to economically disadvantaged and low-performing school districts. This study investigates whether a more equitable allocation of educational resources is followed by more equal student performance. In particular, we examine convergence in student achievements among Arkansas school districts from 2004-05 to 2013-14 academic years. Using traditional convergence tests, we find some degree of overall convergence. We further employ a novel clustering method developed by Phillips and Sul (2007, 2009) to detect convergence clubs. We find that instead of a full panel convergence, school districts’ overall academic outcomes converged into three clubs, within which the member districts trend toward their club-specific equilibrium paths. Poorer districts and districts serving a larger proportion of non-white and male students are more likely to end up in the low-performing club. Our results suggest that school finance reforms can reduce but not eliminate student achievement gaps.

South Carolina’s Act 388: Exploring the Relationship of Tiered Reimbursement on School District Revenue

By: Sharda Jackson Smith, Davíd G. Martínez, & Henry Tran

Abstract Accordion Closed

Property tax limits have been found to reduce property tax revenue, with compensatory increases in replacement taxes often not sufficiently making up for funding loss and systematically promoting inequity. Consequently, such practices suggest severe implications for school district fiscal capacity. Our study explored this issue in South Carolina after Act 388’s reimbursement implementation, with a special focus on rural school districts. We examined through correlation and regression the degree to which revenue served as a function of fiscal capacity, and fiscal capacity as a function of reimbursement. Our results established a plausible link between the state’s property tax exemption law and school revenue availability for rural districts, non-rural districts, and the state as a whole. We conclude that consequential funding disproportionality resulted in a negative impact on rural, low-income districts.