When we get to the cold-hard facts of budgets and spending in education, the tools economists have to offer simply cannot be ignored. With outstanding questions about the optimal use of resources and efficacy, long-term effects, and rates of return, we have no choice but to join the conversation, even if thinking about what’s best for our students is the only thing we want to care about.
However, a deeper look at the economic literature that has been most influential in education would provide a refreshing insight: The contributions have been much more diverse than just standard finances. From microeconomics to game theory and behavioral economics, the field has played an important role in unveiling the very ways in which we learn. Furthermore, economic concepts like externalities, spillovers or opportunity costs have turned out to be a way to study —and disregard— programs and approaches in education whose positive outcomes turned out to be mistakenly attributed.
Below, we take a look at some of the most influential research papers on education economics of all time, according to RePEc. The Research Papers in Economics is a volunteer effort to offer a decentralized database of economic research spanning 93 countries, 50,000 authors, and 2.3 million research items. All of the articles reviewed below are in the top 1,000 of all economic fields, according to the site’s impact factor.
#1. Barro, Robert J & Lee, Jong-Wha, 2001.
“International Data on Educational Attainment: Updates and Implications”
Oxford Economic Papers, Oxford University Press, vol. 53(3), pages 541-563, July.
Barro’s seminal research might not have invented the term human capital, but it brought it into the mainstream. By taking a long-term look at the trends throughout the second half of the 20th century, it shows the unmistakable path towards higher school enrollment across all levels of education, as well as evidence of the great difficulties some regions face that persist over decades. Some of the estimation techniques are the basis for the regional and national scores maintained by organizations such as OECD and UNESCO today.
#2. Card, David, 1999.
“The causal effect of education on earnings”
In: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863
We tend to take for granted that a better education leads to a better standard of living. This is generally true, except with some significant disparities, suggesting that education is not always the main factor when thinking about future quality of life. In one of the first and few instances of studies based on identical twins, this paper shows that the net worth of two otherwise exact people can vary by 10% on average, with best case scenario returns to schooling at 40%. It began to suggest social disadvantages have a limiting effect on the benefits of education.
#3. Becker, Gary S & Tomes, Nigel, 1986.
“Human Capital and the Rise and Fall of Families”
Journal of Labor Economics, University of Chicago Press, vol. 4(3), pages 1-39, July.
One of the problems economists face when trying to look into what happens in the classroom is the low quality of data (if there is any to observe at all). When data is low-quality or nonexistent, economists build models. The only issue here is that for a model to work with unobtainable information, we have to rely on assumptions.
Gary Becker holds a special reputation among economists in this regard. His method of thinking of people and families as decision makers, who always seek to maximize their utility, has never been free from criticism. But at the end of the day, Becker’s ideas choices involving education, that would increase inter-generational opportunities, have remained valid and hard to disprove as explanations.
#4. Sandra E. Black, 1999.
“Do Better Schools Matter? Parental Valuation of Elementary Education”
The Quarterly Journal of Economics, Oxford University Press, vol. 114(2), pages 577-599.
There are plenty of people rallying behind school reform. But when it’s time to answer, “Reform towards where?” eyeballs tend to turn towards economists. This could be seen as a problem, because economics is supposed to help answer how something can be done and how much it might cost, but not what or why. Even in the best case scenario, thinking about making schools better overall still leaves several degrees of freedom.
On the household level, we tend to believe parents who spend more money on the education of their children care more, for which the correlation with higher test scores would be definitive proof. But what studies such as Black’s show is that there is a limit on the effect of extra money for higher education. This finding, coupled with the fact that spending is but one variable in a sea of factors, could help us see educationally frugal parents through a more forgiving lens.
The rest of the top-ten list includes:
- #5. Psacharopoulos, George, 1994.
“Returns to investment in education: A global update,” World Development, Elsevier, vol. 22(9), pages 1325-1343, September.
- #6. Edward Miguel & Michael Kremer, 2004.
“Worms: Identifying Impacts on Education and Health in the Presence of Treatment Externalities,” Econometrica, Econometric Society, vol. 72(1), pages 159-217, 01.
- #7. Barro, Robert J. & Lee, Jong Wha, 2013.
“A new data set of educational attainment in the world, 1950–2010,” Journal of Development Economics, Elsevier, vol. 104(C), pages 184-198.
- #8.Mikael Lindahl & Alan B. Krueger, 2001.
“Education for Growth: Why and for Whom?,” Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1101-1136, December.
- #9.Roland Benabou, 1993.
“Workings of a City: Location, Education, and Production,” The Quarterly Journal of Economics, Oxford University Press, vol. 108(3), pages 619-652.
- #10.Alan B. Krueger, 1999.
“Experimental Estimates of Education Production Functions,” The Quarterly Journal of Economics, Oxford University Press, vol. 114(2), pages 497-532.