Money Doesn’t Buy Results

Marc Kilmer Mar 4, 2010

As predictable as night following day, talk of tinkering with education funding in Annapolis provoked a rally on the Statehouse steps by educators, parents, and children decrying any reduction in education funding. As one parent said, "There are some things that are indispensable. Education for our children is one of those things." Certainly. But what does that have to do with how much money is spent on education?

There is a persistent belief, embodied by this protest, that education funding is responsible for educational results. Unfortunately, it's incorrect to believe that if you increase education funding you'll necessarily improve education. The corollary, if you cut education funding you'll hurt education, doesn't need to be true, either. The fact is that the level of education funding has little to do with how well students are taught. How the money is spent is what's really important. If the money is being spent poorly, you can continue to increase funding and it will have no effect.

One of the most comprehensive reviews of studies on education funding was done by Dr. Eric Hanushek of Stanford University. He found that only 27% of 163 studies found a statistically significant relationship between an increase in per-pupil funding and student achievement. Of those studies, two-thirds showed an insignificant correlation and the others showed a negative correlation. Another study of Dr. Hanuskek finds that input-based education policies, such as increased funding, don't produce results unless you change incentives within schools.

If these parents, educators, and children who protested at the Statehouse really want to ensure better education in Maryland, focusing on how much money the state spends on education funding isn't a productive use of their time. Instead, they should be looking at how their local schools are spending this money. If they are interested, the Maryland Public Policy Institute has quite a few ideas on where they can start.