Investment in Education as a Rural Development Strategy: Do Increased Inputs Have an Impact?

Support for public education wavers in a number of states due to a lack of evidence indicating that increased funding is associated with increases in output. Maintaining and increasing this support, however, is critical for rural communities as they seek to strengthen their human capital base as a strategy for economic growth and development. The results of an education production model, estimated with an expenditure variable specified as a polynomial lag, suggest allocating resources to education increases output as teacher quality and quantity and increased funding have positive influence on educational outcomes. Standardized achievement test scores are used as school output measures. Teacher input measures include percent with masters degrees and pupil/teacher ratio. Per pupil expenditure is used as a measure for supplies/facilities. Nonschool inputs are average daily school system attendance rate and parent-teacher organization participation rate. Percent of population 25 years or older with high school diploma and percent nonwhite are included as household or socioeconomic input measures. The high school student retention rate represents school quantity. Classifications of school districts (city, urban county, suburban county, and rural county) are included in the model using discrete measures to examine the effects of community structure on the education process. (NEC)