Economics of Education - Assignment Example

Hanushek uses statistical analysis, typically regression analysis, to analyze results from a total of 137 studies. He samples the work to smaller groups depending on the number of researches that used a given parameter. He investigates three main factors that have greatly been used to determine basic school expenditures namely schools, expenditure and achievement. According to most researches, instructional expenditures accounts for approximately two thirds of a school’s expenditure. Instructional expenditures are determined by class sizes and teacher salaries.

For these reason, he sampled a total of 7 expenditure parameters used in a majority of the investigated studies. These parameters include teacher/pupil ratio, teacher experience, teacher education, teacher salary, administrative inputs, expenditure/pupil, and facilities. By analyzing the impact of each of these parameters, Hanushek sought to show that there is no strong correlation between the level of expenditure and the school performance and therefore, school policies should not be formulated based on this (Hanushek ).

He carried out extensive regression analysis to show how results from different studies were statistically insignificant with the use of the seven parameters. The second study by Hedges et al. reanalyzes the literature review done by Hanushek. The researchers in this case began by setting a null hypothesis that the educational resource inputs do not have an impact on the performance of students. They used different statistical methods of analysis and the same data used by Hanushek to show that Hanushek’s vote count was inconsistent with the null hypothesis.

They used a normal curve to show how the conclusions failed to consider basics of statistics analysis. Among the defects they were able to show in Hanushek’s work include failure to provide indications for the effects’ magnitude and using vote counting, yet it depicts low power in detecting defects. They concluded that Hanushek made a type II statistical analysis error by using this statistical method. To correct the mistakes in Hanushek’s work, they used sophisticated procedures namely combined significance tests and effect magnitude analysis.

Combined significance tests are done by combining the p-values of significance values from all the studies that test similar conceptual hypothesis but uses different outcome measures and designs. Using this method, Hedge et al were able to show that there is a significant positive relationship between input resources and student performance. Effect magnitude analysis method is a method where coefficients from independent studies are combined. This method of analysis was also able to show a positive relationship between school inputs and performance.

They used standard deviation methods to standardize both inputs as well as outputs. Question 2 Although both studies used the same data set to analyze the data, they had different conclusions. Hanushek concluded that expenditure was statistically insignificant on student performance, while Hedge et al concluded that all the seven inputs had a positive effect on student performance. According to Hedge et al, the amount of expenditure input can help improve general student and school performance.

These differences in conclusion are