Current Issue: Volume 16, Issue 1, Winter 2021

Education Finance and Policy - Volume 16, Issue 1, Winter 2021

Presidential Essay

AEFP in a Time of Upheaval. Thomas Downes. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 1–6

COVID-19’s upheaval has touched the Association for Education Finance and Policy (AEFP), as it has almost every person and organization worldwide. On 10 March 2020, with increasing evidence of community spread of COVID-19, the AEFP Board made the difficult decision to move the 2020 conference online. On 19 March, I delivered the initial version of this address into the ether. At that time, I did what all AEFP presidents do, and spent a few minutes thanking everyone who helped make the conference happen. Those thanks never appear in the published versions of the Presidential Addresses, until now. These are not normal times, and many people who typically do not have their names on the pages of this journal deserve mention for everything they did to save the conference and the organization over this tumultuous year.


The Compositional Effect of Rigorous Teacher Evaluation on Workforce Quality. Julie Berry Cullen, Cory Koedel, and Eric Parsons. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 7–41

We study how the introduction of a rigorous teacher evaluation system in a large urban school district affects the quality composition of teacher turnovers. With the implementation of the new system, we document increased turnover among the least effective teachers and decreased turnover among the most effective teachers, relative to teachers in the middle of the distribution. Our findings demonstrate that the alignment between personnel decisions and teacher effectiveness can be improved through targeted personnel policies. However, the change in the composition of exiters brought on by the policy we study is too small to meaningfully impact student achievement.

Pensions and Late-Career Teacher Retention. Dongwoo Kim, Cory Koedel, Wei Kong, Shawn Ni, Michael Podgursky, and Weiwei Wu. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 42–65

Public school teachers retire much earlier than comparable professionals. Pension rule changes affecting new teachers can be used to close this gap in the long run, but any effects will not be observed for decades and the implications for workforce quality are unclear. This paper considers targeted incentive policies designed to deter retirement among senior, experienced high-need science and math teachers, as a policy to staff classrooms with qualified teachers and improve workforce quality. We use structural estimates from a dynamic retirement model to simulate the workforce effects of targeted late-career salary bonuses and deferred retirement plans (DROPs) using administrative data from Missouri. Although both policies produce additional teaching years at relatively low costs, by forcing teachers to reveal work–retirement preferences, DROPs generally yield incremental teacher years at lower cost per year. More generally, this work highlights the utility of using structural retirement models to analyze fiscal and workforce effects of changes to public sector pension plans, since the effects of pension rule changes cumulate over many years.

Competitive Impacts of Means-Tested Vouchers on Public School Performance: Evidence from Louisiana. Anna J. Egalite and Jonathan N. Mills. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 66–91

Given the significant growth rate and geographic expansion of private school choice programs over the past two decades, it is important to examine how traditional public schools respond to the sudden injection of competition for students and resources. Although prior studies of this nature have been limited to Florida and Milwaukee, using multiple analytic strategies this paper examines the competitive impacts of the Louisiana Scholarship Program (LSP) to determine its achievement impacts on students in affected public schools. Serving 4,954 students in its first year of statewide expansion, this targeted school voucher program provides public funds for low-income students in low-performing public schools to enroll in participating private schools across the state of Louisiana. Using (1) a school fixed effects approach and (2) a regression discontinuity framework to examine the achievement impacts of the LSP on students in affected public schools, this competitive effects analysis reveals neutral to positive impacts that are small in magnitude. Policy implications are discussed.

The Effect of Large-scale Performance-Based Funding in Higher Education. Jason Ward and Ben Ost. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 92–124

The use of performance-based funding that ties state higher education appropriations to performance metrics has increased dramatically in recent years, but most programs place at stake a small percent of overall funding. We analyze the effect of two notable exceptions—Ohio and Tennessee—where nearly all state funding is tied to performance measures. Using a difference-in-differences identification strategy along with a synthetic control approach, we find no evidence that these programs improve key academic outcomes.

Estimated Profit: A Look at the Excess Revenues of Private Four-Year Nonprofit Postsecondary Institutions. Robert Toutkoushian and Manu Raghav. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 125–145

In this study, we use institution-level data for the period 2004 to 2016 from the Integrated Postsecondary Education Data System to examine the excess revenues of private, four-year nonprofit institutions. We present data on the magnitude of excess revenues for these institutions over this period, examine how excess revenues are associated with different types of private institutions, and how within-institution excess revenues are affected by changes in time-varying factors, such as their size, selectivity, revenue structure, and expense distribution. We find that across most years in our sample, private, four-year nonprofits averaged double-digit excess returns. The results show that variations over time in excess revenues are related to a number of factors, including institution size, yield rates, net tuition revenue, and tuition discount rates.

Effects of a Double Major on Post-Baccalaureate Outcomes. Qiong Zhu and Liang Zhang. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 146–169

We use data from the Baccalaureate and Beyond Longitudinal Study and propensity score weighting methods to estimate the effect of a double major on bachelor's degree recipients’ earnings within four years after college graduation. We classify each of a student's two majors in a double major combination as either “higher- or lower-paying,” based on the rank order of the average earnings of each major among single major students. Our analyses yield three main findings. First, within one year after graduation, double major graduates earn significantly less relative to their single major peers with the same higher paying major; however, by four years after graduation, their earnings are similar to those with the single higher paying major and significantly higher relative to those with the single lower paying major. Second, we find that double major graduates are more likely to be employed, work longer hours, and pursue graduate education than their single major peers four years after graduation. Finally, transcript data suggest that double major graduates take fewer classes in the higher paying major, which may explain their initial earnings penalty relative to those with the higher paying single major.

Policy Brief

Teachers’ Unions, Collective Bargaining, and the Response to COVID-19. Annie A. Hemphill and Bradley D. Marianno. Education Finance and Policy Winter 2021, Vol. 16, No. 1, pp. 170–182

In response to the COVID-19 crisis, school districts worked quickly to roll out distance learning plans in the spring. Sometimes these plans impinged upon or were directly in conflict with provisions found in collective bargaining agreements (CBAs) negotiated between teachers' unions and district administration. In this brief, we unpack how urban school systems changed CBAs to make way for learning under COVID-19 conditions. We review COVID-19–related contract changes in 101 urban school districts around the country. We find that twenty-five urban school districts returned to the bargaining table with teachers’ unions to negotiate short-term fixes to CBAs that allowed for more flexibility to implement distance learning. These contract changes focused on several areas of the CBA, including compensation, workload, non-teaching duties, evaluation, leave, and technology. We argue that the lessons learned in spring contract negotiations have implications for the design and implementation of fall schooling plans, and that how fall schooling plays out will shape teacher morale and labor relations beyond the 2020–21 school year.