When Schools Spend Less, Do Families Spend More? IPSEP Working Paper No. 1

Overview & Synopsis

This working paper explores the relationship between local public education spending, local public school demographics, and family spending on supplemental education or private schooling. Basic to its analysis are data on school spending from the National Center for Education Statistics as well as data on family spending from the Panel Study of Income Dynamics. The analysis finds that spending on supplemental education or private schooling is not significantly related to local public education spending. However, such spending is significantly related to the racial/ethnic composition of school districts. Where school districts are more racially and ethnically diverse, families spend more on supplemental education or private schooling. This result is driven by the families with the highest spending, who are paying tuition for private schooling. [This paper was created with the International Partnership for the Study of Educational Privatization (IPSEP).]