EDUCATION-FINANCE REFORM AND THE DISTRIBUTION OF EDUCATION RESOURCES

Between 1971 and 1996 opponents of local funding for public schools su ccessfully challenged the constitutionality of school-finance systems in 16 states. Using the variation across states in the timing of these cases we investigate the impact of reform on the distribution of scho ol resources. Our results suggest that court-ordered finance reform re duced within-state inequality in spending by 19 to 34 percent. Success ful litigation reduced inequality by raising spending in the poorest d istricts while leaving spending in the richest districts unchanged the reby increasing aggregate spending on education. Reform led states to fund additional spending through higher state taxes.