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What is the most cost effective enrollment size for a school?
Why is this question important? The trend over the past 75 years is for schools in the United States to grow in average enrollment
This growth was partially the result of the urbanization of the country
as well as a response to economic theory.
The theory of “economy of scale” was rapidly adopted beginning in the
1960’s. The theory postulates that as units of operation grow the units become
more cost effective to operate. The search for an optimum unit size offering the
lowest cost per unit led to ever increasing school enrollments. It would be wonder if a straightforward
solution, such as school size, could be found to reducing the cost of education. Can school size save the education
system the cost of educating each child?
See further discussion below.
Optimum School Size - Economies of Scale
(Cohn, 1975)
Source:
Graph #1: Average
Enrollment – 2006 Digest of Education Statistics, Education
Statistics, National Center for Education Statistics, U.S. Department of
Education Statistics -http://nces.ed.gov/programs/digest/d06/tables_2.asp#Ch2Sub4
Cost Per Pupil: 2008 Digest
of Education Statistics, National Center for Education Statistics, U.S. Department
of Education - http://nces.ed.gov/programs/digest/d08/tables/dt08_185.asp
Graph #2: Optimum
School Size – Economies of Scale, School Reform and the No-Man's-Land of High School Size, Tom
Gregory, 2000
Wing Institute
Literature Review: The Wing Institute conducted an analysis of 16 studies
on the relationship between school size and cost.
- Nine studies were relevant to the topic of size
and cost and were included in the review
- All of the eight major studies conducted since
1980
- The papers are as follows:
- five of the studies consisted of literature
reviews
- one study identified as meta-analyses
- one study examined size and fiscal performance
of 121 schools in New York City
Cost Studies
of School Size Reviewed for this Analysis
Study
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Type of Study
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Variables/methods
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Findings
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Limitations
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Links |
Andrews,
2002 - Revisiting Economies of Size in American Education: Are We Closer to a
Consensus?
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Literature
Review
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A
review of the 10 best cost studies & 12 best production studies
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Moderately
sized elementary schools 300-500 and high schools 600-900 my optimally
balance costs and benefit
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Many of
the studies had methodological problems regarding cost.
|
go to article |
Fox,
1980 – Relationship
Between Size of Schools and School Districts and the Cost of Education
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Literature
Review
|
Cost-benefit
studies
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A
curvilinear effect was found with smallest and largest schools costing the
most.
|
Transport
and quality of education provided may confound the issue.
|
go to article |
Gregory,
2000 – School Reform and the No-Man's-Land of High School Size
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Literature
Review
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Examination
of the dominant trends in the effects of school size on the cost of
education.
|
High
schools continue to grow in size, a large body of evidence indicates moving
away from large schools, the earlier the research the more likely it favors
larger sizes, and recent studies fail to support the fact larger schools are
cost effective.
|
The
paper’s spends only a limited amount of time reviewing the input issue of
cost.
|
go to article |
Steifel,
Berne, Iatarola, & Frucher, 2000 - The Effects of Size of Student Body on
School Costs and Performance in New York City High Schools
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A study
of 121 New York City high schools
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Dependent
variables: 4-year graduation rates, budget/graduate. Independent: size, SES,
English language proficiency, and special education rates, and Regents Exam
pass rates.
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Small
high schools defined as <600, medium 600-2000 & large as >2000.
Small and large schools had similar budgets per graduation, while medium
schools had the largest budgets per graduation
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Urban
focus may have skewed the results, the ave. 4-year graduation of study was
only 50%, and the poverty rate was 45%. Sample was small with only 19 small
schools included.
|
go to article |
John
Slate & Craig Jones, 2005 - Effects of School Size: A review of the
Literature with Recommendations
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Literature
Review
|
The
review focused on studies examining the effects of size on costs, diversity
of curriculum, achievement, and related variables.
|
The
assumption that larger schools are most cost effective is flawed. It appears
a curvilinear relationship best represents small and larger schools as the
most expensive. The research did not support a curricular advantage for
either size model. A curvilinear relationship best represented the
relationship between achievement and school size based on SES.
|
Many of
the studies had methodological problems.
|
go to article |
Lindsay
Page, Carolyn Layzer, Jennifer Schimmenti, Lawrence Bernstein, and Leslie
Horst 2002 - National Evaluation of Smaller Learning Communities
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Literature
Review
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This is
a review of 55 studies. Included in the review were: 3 cost studies, 25 case
studies, and 27 outcome based studies (2 experimental designed and 3
quasi-experimental). They were able to establish effect sizes for nine
studies.
|
Small
size positively correlated higher achievement to low-SES students. Larger
schools showed positive achievement for student of high-SES status. Smaller
schools had lower drop out rates, better attendance, and higher graduation
rates. Small and large schools were determined to be equally costly
effective.
|
The
effect size data could not be obtained through the organization, ABT
Associates who sponsored the research.
|
go to article |
Walberg,
J & Walberg J III 1994 - Losing Local Control
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Literature
Review
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This
study is a review of the history of economies of scale and quality of
education. The authors build a correlation between student achievement and
school size. 34 studies were included in this paper.
|
American
schools over the past 70 years has shown increasing expenditures and reduced
performance. The theory, "economy of scale", fueled this trend for
schools to grow larger. The study does not fully support the trend and they
contend value output is inversely related to size, the larger the
organization the lower the results.
|
The
type of data used in this study cannot be used to establish cause and effect.
|
go to article |
Gooding
& Wagner, 1985 - A Meta-Analytic Review of the Relationship between Size
and Performance: The Productivity and Efficiency of Organizations and Their
Subunits.
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A Meta-
analysis
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A
meta-analysis of 31 studies in which correlational coefficients are
aggregated to correct for statistical artifacts. Three steps: 1. Estimation
of population mean, correlations, and variance. 2. Correction for statistical
artifacts. 3. Analysis of moderating effects
|
This
study challenges the notion that economies of size exist. The study
determined that diseconomies offset previously identified benefits, thus
diminishing the positive effects of growth.
|
The
organizations studied make it difficult to make generalizations to schools.
|
go to article |
Robert
Tholkes and Charles Sederberg, 1990 - Economies of Scale and Rural Schools
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Literature
Review
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23
studies were included in this review. A summary of the studies and the
history of economies of scale in educational
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The
study contends economy of scale can be achieved to reduce educational costs
and improve student achievement. Unfortunately, this does not hold for rural
schools because of transportation costs.
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The
study was not specific in detailing the process utilized for the inclusion
and rejection of studies.
|
go to article |
Results:
- For the past fifty years the number of
elementary and secondary schools in the United States has declined and the
average size of school have grown by more than 35%.
- Between the 1950 and 1980 the prevailing
assumption was that economies of scale inevitably result in lower costs to
educate each student.
- As
the average school size grew during the sixties and seventies research began to
challenge the long held belief that larger was cheaper.
- By the 1990’s the prevailing wisdom shifted
favor from larger schools to smaller. This trend is observed in the stabilizing of the average
elementary and secondary school size since 2000.
- The review of nine studies offers the following
conclusions on the subject of cost per pupil and school size.
- Not one of the nine studies found support for
larger schools as a cost savings strategy.
- Three studies identified a curvilinear
relationship as regards school size and cost. These studies found smallest and
largest schools to be the most expensive. They suggest the existence of a sweet
spot between the two extremes that results in medium sized schools offering the
lowest cost per student.
- The Wing Institute analysis of Department of
Education data comparing average school size and the average cost per student
by state appears to show a small relationship between economies of scale
favoring both smaller and larger schools.
- This seems to contradict the recent studies
indicating smaller and larger schools are the most expensive.
- It is important to note that The Wing Institute
analysis does not meet the standards of rigor needed to establish a causal
relationship, but it does suggest that this issue is complex and is susceptible
to many factors.
Implications:
- The
data strongly suggest economy of scale does not exist for schools. (Larger
schools are not the most cost effective option.)
- The
data suggest many factors influence per pupil cost, with size playing a minor
role. (Schools of all sizes can be
cost effective)
- School size is not a universal remedy for
reducing the cost of education.
Authors:
Graph #1: IES National Center for Educational
Services
Graph #2: Tom
Gregory
Literature Review:
See Literature Review spreadsheet
Publishers:
Graph #1: U.S. Department of Education Institute of
Education Sciences - IES National Center for Educational Services
Graph #2: Unpublished paper, School Size, School Reform, and the Moral Conversation,
delivered at the Journal of Curriculum Theorizing Conference held in Bloomington, Indiana, October
18, 1997
Literature Review:
See Literature Review spreadsheet
Study Description:
Graph #1: The analysis compares data obtained from
the National Center
for Education Statistics (NCES) Digest of Education Statistics. Data compared data for the school year
2005-06 for average elementary school size and the average cost per pupil for
all schools. This data was used to produce a scatter-gram
of school size for each state versus per pupil funding level.
Graph #2: The study was a review of the literature examining the way
research and practice has shaped the average size of schools in the United
States since 1970.
Literature Review:
This literature review looked at studies of the cost and the average school
size conducted since 1980. The review was completed utilizing EBSCO publishing
and Google Scholar.
Related Research: Is
the Average Enrollment of Schools Growing? and School Size vs. Student
Achievement
Citations:
Andrews, M., Duncombe, W., & Yinger, J. (2002). Revisiting Economies of Size in American Education: Are We Any Closer to a Consensus? Economics of Education Review, 21(3), 245-262
Fox, W. F. (1980). Relationships between Size of Schools and School Districts and the Cost of Education. Technical Bulletin No. 1621. (ED187029). Retrieved November 30, 2009 from ERIC database.
Gooding, R. Z. & Wagner, J. A. (1985). A Meta-Analytic Review of the Relationship between Size and Performance: The Productivity and Efficiency of Organizations and Their Subunits. (EJ335697). Retrieved November 30, 2009 from ERIC database.
Gregory, T. (2000). School Reform and the No-Man's-Land of High School Size. (ED451981). Retrieved November 30, 2009 from ERIC database.
Page, L., Layzer, C., Schimmenti, J., Bernstein, L., & Horst, L. (2002, February). National evaluation of smaller learning communities: Literature review. Retrieved from http://www.abtassociates.com/reports/SMALLER.pdf
Slate, J. R. & Jones, C. H. (2005). Effects of School Size: A Review of the Literature with Recommendations. Essays In Education, 13 Retrieved from http://www.usca.edu/essays/vol132005/slate.pdf
Stiefel, L., Iatarola, P., Fruchter, N., & Berne, R. (1998). The Effects of Size of Student Body on School Costs and Performance in New York City High Schools. (ED420464). Retrieved November 30, 2009 from ERIC database.
Tholkes, R. J. & Sederberg, C. H. (1990). Economies of Scale and Rural Schools. (EJ418887). Retrieved November 30, 2009 from ERIC database.
Walberg, H. J. & Walberg, H. J. (1994). Losing Local Control. (EJ490373). Retrieved November 30, 2009 from ERIC database.
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