Demographic Structure and the Political Economy of Public Education

James M. Poterba

NBER Working Paper No. 5677
Issued in July 1996
NBER Program(s):Aging, Public Economics

This papers examines the relationship between demographic structure and the level of government spending on K-12 education. Panel data for the U.S. states over the 1960-1990 period suggests that an increase in the fraction of elderly residents in a jurisdiction is associated with a significant reduction in per child educational spending. This reduction is particularly large when the elderly residents and the school-age population are from different racial groups. Variation in the size of the school-age population does not result in proportionate changes in education spending, so students in states with larger school-age populations receive lower per-student spending than those in states with smaller numbers of potential students. These results provide support for models of generational competition in the allocation of public sector resources. They also suggest that the effect of cohort size on government-mediated transfers must be considered in analyzing how cohort size affects economic well-being.

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Document Object Identifier (DOI): 10.3386/w5677

Published: Journal of Policy Analysis and Management, Vol 16, no. 1, pp. 48-66, (Winter 1997) citation courtesy of

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