Does more spending increase student performance?

Patrick Gibbons

When one takes capital outlays, school debt and other payments into the equation, Nevada's K-12 per-pupil spending was $10,420 in 2006 (in 2008 dollar values), which moves Nevada's per-pupil spending ranking up to 31st in the nation from the 44th ranking often cited. As interesting as this is, the per-pupil ranking is still useless.

NPRI has said it over and over and over again, but more spending does not equal better student performance or achievement. Below you will see the comparison between overall K-12 education spending and the NAEP fourth-grade reading scores. This is a very simple comparison, but even the more complex studies continue to show that there is no statistical relationship between spending and student performance.

As you can see from the above graph, improvement on the average score is negligible the more states spend per pupil. In fact, after a simple regression analysis we see that spending per-pupil has a very weak positive correlation to student test scores but the relationship is not significant.

Zooming in, you can see the trend in student performance moves up a measly six points on a 500 point scale. The difference in spending would be about $12,000 per pupil – hardly worth it.

But before the big spenders think "Eureka there is improvement" it may actually be the case that per-capita income (an estimation of the average income within a state) plays a role in the improvement of student performance.

As you can see from the above graph, per-capita personal income also plays a small but equally negligible role in better student performance on the NAEP fourth-grade reading exam. So a state with a higher median per-capita income does not have a significant relationship with higher test scores.

However, income per capita is highly correlated with spending per pupil and is also very significant.  The higher the income per capita the more per-pupil spending increases – regardless of student achievement.  If Nevada really wants to increase funding to public education we should only do so if personal income in the state improves – and raising taxes is not a way to increase personal income.

Per-pupil spending has no real bearing on student performance.  Continuing to claim that Nevada needs to increase funding to help our children is false and misleading. If Nevada wants to improve education, we will need to implement real education reform.