Reassessing the View that American Schools Are Broken


This paper evaluates evidence on the effectiveness of elementary and secondary schooling in the
U.S. Contrary to popular perception, most standardized test scores have not declined in the last
quarter century, and the National Assessment of Educational Progress (NAEP) data show a
modest upward trend. In addition, school spending per pupil and NAEP scores exhibit a positive
correlation in the aggregate data. A review of the Tennessee Student-Teacher Achievement Ratio
(STAR) experiment indicates that students who were randomly assigned to smaller classes
performed better on standardized tests. Both the aggregate NAEP data and the STAR experiment
suggest that a 7 student reduction in class size is associated with a 5 to 8 percentile point increase
in test scores, on average. Evidence also suggests that students from low socioeconomic status
families learn just as much during the school year as students from high socioeconomic status
families, but students from low socioeconomic status families fall behind during the summer
months. Finally, the earnings of high school graduates relative to high school dropouts increased
substantially between 1979 and 1996, suggesting that high schools provide skills that are valued
by the labor market.

Year of Publication
Date Published
Publication Language
Citation Key
Economic Policy Review, Federal Reserve Bank of New York, vol. 4, no. 1, March 1998
Working Papers