Do School Facilities Matter? Measuring the Effects of Capital Expenditures on Student and Neighborhood Outcomes

The authors contribute to research on school building quality and student outcomes by exploring the effects of spending on school facilities on both student and neighborhood outcomes. They link data on new facility openings to administrative student and real estate records in the Los Angeles Unified School District (LAUSD). The authors find that spending four years in a new school increases test scores by 10% of a standard deviation in math and 5% in English Language Arts. Student achievement improves because students attend four additional days each school year, and teachers report greater effort. These effects do not appear to be driven by changes in class size, teacher composition, or peer composition, but reduced overcrowding plays a role. House prices rise by 6% in neighborhoods that gain new schools.