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The Efficiency of the Supply of Public Education

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Author Info
Theodore C. Bergstrom
Judith Roberts
Daniel L. Rubinfeld
Perry Shapiro

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Abstract

The question of whether governments spend too much or too little has been a frequent subject of debate, but has been infrequently analyzed.This paper proposes and then applies a methodology which checks to see whether the "Samuelson condition" for the efficient provision of local public education is satisfied, i.e. whether the sum over the school district of individual marginal rates of substitution between public education and a private numeraire equals the marqinal rate of technical substitution between these two qoods. The econometric methodology uses a micro-based approach to the estimation of marginal rate of substitution functions which accounts for possible biases associated with the selection of school districts by individual households.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 1901.

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Date of creation: Apr 1986
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Handle: RePEc:nbr:nberwo:1901

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  1. Ted Bergstrom, 1979. "When Does Majority Rule Supply Public Goods Efficiently?," University of California at Santa Barbara, Economics Working Paper Series 1979A, Department of Economics, UC Santa Barbara. [Downloadable!]
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  2. Gramlich, Edward M & Rubinfeld, Daniel L, 1982. "Micro Estimates of Public Spending Demand Functions and Tests of the Tiebout and Median-Voter Hypotheses," Journal of Political Economy, University of Chicago Press, vol. 90(3), pages 536-60, June. [Downloadable!] (restricted)
  3. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January. [Downloadable!] (restricted)
  4. Ted Bergstrom & Richard Cornes, 1983. "Independence of Allocative Efficiency from Distribution in the Theory of Public Goods," University of California at Santa Barbara, Economics Working Paper Series 1983B, Department of Economics, UC Santa Barbara. [Downloadable!]
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  5. Courant, Paul N & Gramlich, Edward M & Rubinfeld, Daniel L, 1979. "Public Employee Market Power and the Level of Government Spending," American Economic Review, American Economic Association, vol. 69(5), pages 806-17, December. [Downloadable!] (restricted)
  6. Bergstrom, Theodore C & Rubinfeld, Daniel L & Shapiro, Perry, 1982. "Micro-Based Estimates of Demand Functions for Local School Expenditures," Econometrica, Econometric Society, vol. 50(5), pages 1183-1205, September. [Downloadable!] (restricted)
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  7. Brueckner, Jan K., 1982. "A test for allocative efficiency in the local public sector," Journal of Public Economics, Elsevier, vol. 19(3), pages 311-331, December. [Downloadable!] (restricted)
  8. Barlow, Robin, 1970. "Efficiency Aspects of Local School Finance," Journal of Political Economy, University of Chicago Press, vol. 78(5), pages 1028-40, Sept.-Oct. [Downloadable!] (restricted)
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