A primary rationale for public provision of K-12 education and state financing of school spending is that education fosters civic engagement and the development of social capital. However, limited evidence exists on whether and how school spending affects civic engagement. Virtually all studies focus on the impact of educational attainment (as opposed to school spending) on political activity. We provide the first causal evidence on how school spending affects volunteerism as well as voting. The court-ordered and legislative school finance reforms that occurred throughout the United States over recent decades led to large and plausibly exogenous shocks to K-12 school spending. We estimate difference-in-difference-in-differences (DDD) models to isolate the causal impact of school spending on civic engagement. Using data from the National Education Longitudinal Study of 1988 (NELS), the Education Longitudinal Study of 2002 (ELS), and the High School Longitudinal Study of 2009 (HSLS), we find that exogenous increases in school spending led to increases in the probability that young adults volunteer and the amount of time they spend volunteering. In contrast, we find little evidence that school spending impacts voting. Consistent with prior studies, we find that increases in school spending increase high school graduation and college attendance.
First version, November 2022
H42: Publicly Provided Private Goods
"H72: State and Local Government--Health, Education, Welfare, Public Pensions"
I22: Educational Finance
I26: Returns to Education