The impact of federal, state and local taxes on student achievement in public schools: the case of Indiana

Abstract

In this article, data from 286 Indiana school districts during the 2009–2010 school year were used in a case study to investigate whether fiscal funding has a direct effect on education output (i.e. student achievement). Two results were found: (1) while federal taxes are not significantly associated with student achievement in public schools, both state and local taxes are strongly related to student achievement in public schools, implying a direct effect on education output; and (2) state tax funding has a greater impact on education output than local tax funding.

Keywords:

• federal taxes
• state taxes
• local taxes
• student achievement

JEL Classification:

• I20
• I22
• C21

Notes

¹ White students are the majority group in Indiana.