Meryle G. Weinstein, Leanna Stiefel, Amy Ellen Schwartz, Luis Chalico

Since its inception as part of the 1965 Elementary and Secondary Education Act(ESEA), Title I has provided the largest amount of federal funding aimed at improving the academic achievement of poor children. In this paper, we examine the impact of Title I on school spending and school performance, using New York City public school data. Based on a regression discontinuity design (RD) with panel data, and including separate analyses for elementary/middle and high schools, we estimate local average treatment effects of Title I.

Title I provides additional funding for schools serving high concentrations of poor children, but there are few curricular or programmatic constraints. Unfortunately it is possible that Title I funds supplant state or local funds, resulting in muted net impacts on spending and student outcomes. At the same time, the success of Title I in improving test scores offers important insight into the effectiveness of school-based compensatory funding in general, such as weighted student funding within districts or state compensatory aid across districts.

Overall, the results indicate that Title I changes the mix of spending, enabling high schools to significantly increase the amount of money they spend on direct services to students and to improve their pupil-teacher ratios (while reducing experienced teachers). Elementary and middle schools do not increase spending as much, which is consistent with our finding that state compensatory education funds may be supplanting some Title I funding in schools. Since schools just below the Title I cutoff are similar to those just above the cutoff, this finding may be an equitable, albeit unintended result.

Finally, additional Title I spending does not improve the achievement of students and may even reduce school-wide average test scores in elementary and middle schools. These effects for both spending and scores seem to increase with the length of time schools are Title I eligible and to be stronger for ones that are always Title I eligible compared to those that go in and out of eligibility.

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