Cost Analysis in Education: Paradox and Possibility

Abstract

In comparison with other types of program evaluation, cost analysis of educational programs and policies is a relatively recent phenomenon. Costbenefit and cost-effectiveness analyses were developed by economists in the 1930s and 1950s, respectively, but it was not until the 1960s that these approaches were used to assess efficiency in the educational sector (Levin, 1991). While the vast majority of education program evaluation studies focused exclusively on the effectiveness of various alternative courses of action, the competing pressures associated with an increasing array of policy options in a climate of growing resource constraint make cost-based evaluations of educational programs and policies more relevant now than ever. This leaves us with an interesting paradox to consider: why such a seemingly relevant form of analysis has been so underutilized in the field of education.After discussing the paradox in more detail, this article offers several explanations for the relative scarcity of cost-based evaluations in the education arena. The article then shifts to explore an alternative approach to cost analysis that has the potential to address the difficulties that have heretofore undermined widespread use of cost-based evaluations of educational initiatives, and concludes with a discussion of the potential for greater utility of such studies.

Is PAR a Good Investment? Understanding the Costs and Benefits of Teacher Peer Assistance and Review Programs

“…First, it is necessary to include all of the possible outputs of such a program, but these benefits are often spread widely and are hard to assess. As Rice (1997) writes, "Although it is often difficult to identify and assign a value to many of the inputs and outputs of educational interventions, their inclusion in the total cost and effectiveness estimates is essential" (p. 311). To include all of these factors in the analysis, researchers must develop estimates of the program's impact on all possible outcomes.…”

The P.E.A.C.E. Pack Program in Italian High Schools: An Intervention for Victims of Bullying

“…Second, involving teachers in training paths focused on the bullying phenomena and in delivering anti-bullying programs for students could potentially strengthen their ability to directly deal with bullying in their everyday classroom practices [7,17]. This may foster teachers' self-efficacy [7] that in turn may positively impact on their recruitment and retention, and more broadly on improvements in self-esteem, or good citizenship among students [18]. However, teacher-driven interventions could also have some limitations.…”

Toward Policy-Relevant Benchmarks for Interpreting Effect Sizes: Combining Effects With Costs

“…Lockheed and Hanushek (1988) and Schiefelbein, Wolff, and Schiefelbein (1999) compare the cost-effectiveness of interventions in developing countries but do not explicitly consider issues of comparability, how the use of the evidence depends on the decision-making context, or how the evidence might be used to create benchmarks. Rice (1997) introduces some of the issues that arise in comparing CERs, focusing on how the use of cost-effectiveness analysis might be expanded through a framework that encourages educational practitioners and program evaluators to consider site-specific cost information. In contrast, the benchmarking approach proposed here is intended to increase the use of cost analysis among researchers—still in an effort to inform local and other decisions but in a way that fits the focus of researchers on theory and generalizability 2.…”

“… 2 Rice’s (1997) discussion starts with the identification of three difficulties in expanding the use of cost analysis: (a) “difficulties associated with the conceptualization and calculation of costs and effects,” (b) “issues associated with the identification and justification of the distribution of costs and effects across stakeholder groups,” and (c) “factors that have limited the generalizability of studies conducted” (p. 310). These same issues are addressed here as well. …”