Reassessing the View That American Schools Are Broken’, Economic Policy Review

growing number of scholars and political commentators have concluded that the U.S. public school system is flawed, and that it can only be corrected by fundamental changes in the institutions that govern education. Chubb and Moe (1990, p. 3), for example, argue that the “existing [educational] institutions cannot solve the problem, because they are the problem. ” Widespread belief that the current educational system is flawed, rather than any concrete or systematic evidence indicating that an alternative system performs better than the current one, has motivated frequent calls for radical “institutional reforms ” of schools. The view that the U.S. school system has failed, or is “broken, ” is commonly supported by three arguments: (1) there has been a steady decline in the performance of American students on standardized tests, (2) American children perform worse on international comparisons than foreign children, and (3) the existing system fails to con-vert school resources (such as smaller classes) into school outputs (such as better test performance).1 This paper reassesses the claim that American schools are broken. The first section examines trends in National Assessment of Educational Progress (NAEP) test scores, and the relationship between average test score performance and school resources on an aggregate level. Although the aggregate data show a surprisingly strong, positive relationship between educational spending and student achievement, one should be cautious about drawing any causal inference from such a relationship because of changes in the composition of students over time and changes in the focus of educational spending. More convincing evidence comes from the randomized experiment on class size, which I describe in the subsequent section. Next, I infer the influence of schooling on student performance by considering gains in student achievement by socioeconomic status (SES) during the school year and during the summer months. The paper’s fina