Equity, efficiency, and school improvement: Analysis of district expenditures in New Jersey

Frank Alfano, Fordham University


Declining revenue has decreased the resources that New Jersey schools will receive. Money problems for school districts have reached epidemic proportions. As a result, state legislatures and school districts alike must learn to spend money more efficiently and equitably. Equity and efficiency are synonymous. If school systems and the state government do not spend money efficiently, then equity can never be accomplished. This dissertation analyzes whether two public school districts in New Jersey and eight public school districts across the United States, in large and small districts, rich and poor, expend their funds efficiently. Thus, the problem is that most school officials and state leaders have very little data on exactly how much of that per pupil expenditure is reaching the instructional area. Without efficiency knowledge, no state legislature or school system can create an equitable plan of distributing resources to the schools. Eric Hanushek (1991) makes the argument that money does not really matter because administrators are not trained enough (or do not care enough) to allocate funds properly, that the additional revenue the state may give to low spending or poor districts may be squandered on non-instructional accounts. Also, other researchers like Chubb and Moe (1990), and Coleman (1987) have done efficiency studies based on how well schools are doing overall comparing "inputs" and "outputs." This study however, analyzes not only the amount of money allocated ("inputs") and pupil outcomes ("outputs"), but explains how the money is spent ("throughputs") by using the Micro-Financial Cascade Model. This model represents a comparison between the amount of dollars that are allocated to the classroom from public schools and the dollar relationship to school productivity rates. Allocations and expenditures are sorted into the 10 functions for both school site and central office. The function categories are entitled Administration, Building and Operational Support, Teacher Development, Pupil Support, and Instructional Support (these five functions are both at the school site and central office). Once a school's expenditures are tracked and put into the proper accounts (functions) then actual efficiency comparisons can be made from district to district and from school to school and greater school efficiency and equity will be obtained.

Subject Area

School finance|Public administration|School administration

Recommended Citation

Alfano, Frank, "Equity, efficiency, and school improvement: Analysis of district expenditures in New Jersey" (1994). ETD Collection for Fordham University. AAI9511216.