Improving America's Schools is a compilation of papers presented at a 1994 conference that examined the problem of improving performance in our nation's schools from an economic perspective. Much economic theory is predicated on the hypothesis that people are individual actors who choose their behavior to maximize benefits for themselves. Within this framework, it becomes imperative for policymakers to determine which incentives are currently working within the educational system, to assess their impact, and to explore how they can be altered to improve our educational performance. Improving America's Schools does much more than present a single issue or viewpoint. It includes articles that highlight the limitations of economic research, as well as its potential contributions. It explores various reform initiatives that use practical incentives: school finance reform, school-based management, assessment, accountability, and staffing. Within these subjects, authors challenge one another as well as educational issues, present new ideas, and help to establish an alternative line of inquiry into the educational policy debate. While educational economists have been around for a long time, few have used their knowledge to inform educational policy debates. This publication hopes "to initiate a serious intellectual debate over education policy by supplying a new, and previously absent, economic dimension" (p. vii).
Marshall Smith, Brett W. Scholl, and Jeffrey Link begin this volume with an analysis of school reform research. Based on their findings, they propose systemic school reform. The major tenet of their proposal is that reform efforts generally fail because all of the pieces needed to move reform forward are not aligned. If reformers can develop policies that combine philosophy, funding, and methods to achieve a set of agreed-upon outcomes, they are much more likely to achieve their goals. The evidence Smith, Scholl, and Link offer to support their plan includes research from education, psychology, sociology, and political science, but not economic research on school performance. They make the argument that most economic research relies too heavily on data that do not capture the essentials of schooling.
In contrast, Eric Hanushek defends the use of economic data and methods in the study of education, and presents examples of how this line of analysis can be used. In "Outcomes, Cost, and Incentives in Schools," Hanushek argues that school change is motivated in large part by economic issues (such as socioeconomic disparities between different racial groups), and that by excluding economic analysis from mainstream discourse we miss essential information about how we are distributing educational resources to our children. To illustrate this point, Hanushek presents data that show that since World War II educational spending has increased, while the returns on this expenditure have not. Drawing on past papers and current data, he concludes that money is not being spent efficiently in the U.S. educational system, and presents recommendations for aligning incentives with measurable outcomes to increase the efficiency and effectiveness of schooling. Smith et al.'s and Hanushek's papers present the core conflict in this volume, highlighting the differences between the conclusions reached from economic and non-economic analysis in education.
The other articles present the varied uses of information that economic analysis and the exploration of incentives can provide policymakers. Brooks Pierce and Finis Welch explore the changes in the U.S. returns to schools, and how those returns have changed across educational levels over the past thirty years. Anita Summers, Amy Johnson, and Jane Hannaway explore the effects of incentives on decentralization and school-based management plans. John Bishop includes a cross-cultural comparison of signaling, incentives, and school organization in France, the Netherlands, Britain, and the United States. Assessment, measurement of outcomes, and the effects of public school partnerships are also explored in three articles by Daniel Koretz, Robert Meyer, and Rebecca Maenad and Meredith Kelsey. The economics of school reform for poor and at-risk students is presented by Henry Levin, and Richard Murnane looks at the economic obstacles to staffing schools with skilled teachers.
Each of these articles fills in a piece of the school reform puzzle and does so using strong economic analysis. This volume manages to make the argument for using economic data and methods in education policy decisions, while providing a broad spectrum of examples for readers.