Governance Matters: School Autonomy, Leadership, Heterogeneity, and Student Outcomes

• In Event: School Resource Allocation

Abstract

This paper provides new evidence on the benefits of localized decision-making in public education, focusing on a Chicago policy that granted school principals greater control over budgeting and operations. This paper presents a meta-analysis showing a small average effect of similar policies, but with significant variation across contexts. Drawing on theories from public finance, contract theory, and psychology, this paper argues that autonomy’s impact depends on leadership quality and alignment between district and school decisions. Event-study models show that, on average, increased school-level control improved math and English passing rates by four percentage points (0.1σ), comparable to costly interventions but achieved at minimal expense. Deconvolution analysis reveals effects ranging from true negatives below the 20th percentile to as large as ten percentage points (0.2σ) at the 80th percentile. Design-based evidence supports the theory: (a) High-performing principals benefit most from autonomy, highlighting the importance of local capacity and aligned incentives. (b) Schools with atypical student populations benefit more, reallocating resources to tailored services, underscoring the potential benefits of decentralization when needs are heterogeneous.

Author

• Clement Jackson, Northwestern University
  Presenting Author