Education Reform Redistribution and Student Achievement Evidence from the Kentucky Education Reform Act

Abstract

The Kentucky Education Reform Act (KERA), implemented in 1990, is one of the most ambitious and influential education reform policies ever attempted by any state. KERA’s main components include a new funding system to correct large financial disparities between school districts, curriculum revision and standardization, and increased school and district accountability. In this paper I explore KERA’s effects on school spending and student achievement. I find that KERA did successfully equalize per-pupil expenditures across rich and poor districts and that this equalization has been sustained throughout the decade since KERA’s passage. KERA’s effects on student achievement have been more modest. Black students in Kentucky have experienced modest test score gains since KERA’s implementation, but the scores of white students have remained unchanged relative to their peers in surrounding states. I also find no evidence that KERA narrowed the gap in test scores between rich and poor districts. Instrumental variables estimates suggest the increased spending induced by KERA did not improve test scores.