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Do Reductions in Class Size Raise Students' Test Scores? Evidence from Population Variation in Minnesota's Elementary Schools


"Policymakers and researchers in the U.S. and in many other countries are concerned about the amount that students learn in primary and secondary schools, and they constantly debate whether particular policies are effective in promoting learning. One policy that has received considerable attention is reduction in class sizes. Many states and cities in the U.S. are spending substantial amounts of money to reduce class size, especially in the early grades of elementary (primary) school. Estimation of the impact of class size reductions is complicated by several problems. Simple comparisons of test scores of students in classes of different sizes produces biased estimates because children in small and large classes differ in a variety of observed and unobserved ways. In theory, random assignment of students to classes of different size will provide unbiased estimates, but random assignment is rare in education research. This paper uses a method introduced by Hoxby (2000) to assess the impact of class size on the test scores of children in grades 3 and 5 in Minnesota public schools. The method exploits random variation in class size due to random variation in births from year to year in school and district catchment areas. The results show positive effects of reductions in class size on mathematics and reading test scores in Minnesota. Yet the impacts of class size reductions are very small; a decrease of ten students would increase test scores by only 0.04 to 0.05 standard deviations, which implies that reductions in class size alone are unlikely to lead to sizeable increases in student learning."

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