London School of Economics Centre for the Economics of Education LSE
Centre for the Economics of Education  (CEE)

Abstract for:

Fiscal and Education Spillovers from Charter School Expansion

Matthew  Ridley,  Camille  Terrier,  September 2018
Paper No' CEPDP1577: | Full paper (pdf)
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Keywords: charter school, competition, fiscal spillover, achievement, synthetic control

JEL Classification: C10; C36; H23; H39; H75; I21; I22; I28

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This Paper is published under the following series: CEP Discussion Papers
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Abstract:

The fiscal and educational consequences of charter expansion for non-charter students are central issues in the debate over charter schools. Do charter schools drain resources and high-achieving peers from non-charter schools? This paper answers these questions using an empirical strategy that exploits a 2011 reform that lifted caps on charter schools for underperforming districts in Massachusetts. We use complementary synthetic control instrumental variables (IV-SC) and differences-in-differences instrumental variables (IV-DiD) estimators. The results suggest greater charter attendance increases per-pupil expenditures in traditional public schools and induces them to shift expenditure from support services to instruction and salaries. At the same time, charter expansion has a small positive effect on non-charter students’ achievement.