How Local Economic Conditions Affect School Finances, Teacher Quality, and Student Achievement: Evidence from the Texas Shale Boom

Abstract

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School Finance Reform and the Distribution of Student Achievement

“…The downward trend continues through the end of our sample. 22 Table 5 presents the parametric estimates. We begin in column 1 with our three-parameter model, as shown in Figure 6.…”

“…The pattern deviates from expectations in one respect, however: There is no indication that the phase-in of the effect slows five or nine years after the event, when the fourth and eighth graders, respectively, will have attended school solely in the post-event period. 23 This may reflect the use of some additional funds for durable 22 The sawtooth pattern at the end of the sample likely reflects the biannual NAEP testing schedule. 23 We have estimated separate nonparametric models for fourth and eighth grade scores.…”

The Texas Drilling Boom and Local Human Capital Investment

“…They find that horizontal drilling and hydraulic fracturing generated higher high school dropout rates among young men, primarily by increasing the relative wages of men without a diploma. Similarly, Marchand and Weber (2015) find that economically disadvantaged, English as a second language (ESL), and vocational students in areas of Texas with more shale resources were pulled out of schools and into the labor market during the 2000s. Measham and Fleming (2014) find a positive effect insofar as they find fracking leads to higher proportions of youth aged 15–24 and 25–34 with university degrees and advanced technical qualifications compared with other rural regions in the short term.…”

“…Schafft et al (2014) find some evidence of student turnover, perhaps because of transient worker families and displacement of lower-income families because of increased housing demand and prices. Marchand and Weber (2015) look specifically at Texas schools, examining compositional effects, and find the shale boom areas (as measured by shale depth) are associated with decreasing populations of economically disadvantaged and ESL students, which they attribute in part to negative selection of these students into the low-skilled labor market. They also show that shale counties with increased tax revenues invested in capital, rather than teachers, resulting in no increases in student achievement.…”

“…These research questions closely follow unanswered questions on the effects of busts that recent literature reviews suggest as an avenue for research (Fleming et al, 2015; Marchand and Weber, 2018). Although previous work has examined the effect of the shale drilling boom on the local overall completion or dropout in various regions (Cascio and Narayan, 2015; Marchand and Weber, 2015; Rickman, Wang, and Winters, 2017), much of this research has not examined subgroup dropout rates. Among this article’s unique contributions are the following: (1) using previously unleveraged data on county-level graduation rates and accompanying drilling locations to directly examine the effect of local drilling, (2) examining the potential for heterogeneous effects on graduation rates among population subgroups, and (3) using spatial regression models to measure spillover effects in human capital investment and regional drilling activity.…”