Economics Research Institute Study Paper
Utah State University Department of Economics
This paper investigates the sources of scale economies in the production of public education. The relationship between the average cost of producing educational output and other school characteristics, including school and district size, is estimated using a neoclassical cost function. The empirical analysis uses panel data from Utah school districts, and estimates the function using the covariance and error component models after making necessary corrections for heteroscedasticity and autocorrelation. The evidence indicates that there are significant scale economies associated with both school and district sizes.
Chakraborty, Kalyan; Biswas, Basudeb; and Lewis, W. Cris, "Economies of Scale in Public Education: An Econometric Analysis" (1999). Economic Research Institute Study Papers. Paper 161.