Average and heterogeneous effects of political party on state education finance and outcomes: Regression discontinuity evidence across U.S. election cycles

Abstract

• Regression discontinuity evidence based on close state elections between 1987–2019 does not consistently show that governments spend significantly more or less on K-12 and higher education when Democrats control state houses. • However, these average effects mask substantial heterogeneity by election timing, as Democratic state houses appropriate significantly less to K-12 after a Presidential election year but significantly more after off-cycle elections. • Including electoral outcomes from both state house and senate elections in the regression discontinuity design results in similar heterogeneous patterns for state spending but also at a greater magnitude for both K-12 and higher education. • Increases to K-12 state appropriations under Democrats after off-cycle elections coincide with greater current expenditures by school districts and better high school graduation rates. • Evidence suggests that heterogeneity may be tied to sociodemographic differences in voters across electoral cycles, as voters are younger, less White, and more likely to be working in education in Presidential election years, i.e., the years after Democrats increase state spending in education. In the U.S., state politicians directly influence legislation and budget decisions that can substantially affect public education spending and students. (When) does the political party of elected officials matter for these outcomes? We introduce a novel multi-dimensional regression discontinuity design to analyze close legislative elections from 1987 to 2019 and find that the impact of Democratic control of state government depends on election timing. Democratic state houses appropriate fewer dollars to K-12 education following a presidential election year, but significantly more during off-cycle elections. These patterns are magnified—for both K-12 and higher education—when Democrats control both legislative chambers. Increases in appropriations coincide with increased current expenditures in K-12 and higher high school diploma rates. Our results highlight the importance of considering how federal political contexts and control over multiple government branches influence the effects of partisanship on states’ education finance and outcomes.