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Intergovernmental Grants to School Districts and Educational Outcomes During the COVID-19 Pandemic
During the COVID-19 pandemic the US federal government appropriated $189.5 billion in emergency aid to school districts. These funds were supplied to help districts replace lost revenues and to mitigate the harmful effects of the pandemic on learning and other measures of district performance. We use a difference-in-discontinuities design to evaluate their causal impact through 2023. Federal funds were passed on to residents through reductions in local revenue collections, including property taxes, such that incremental federal funds did not result in increased per-pupil expenditures by school districts. We find no evidence that additional funds mitigated the declines in test scores. We provide suggestive evidence that changes in political engagement, especially from parents, were greater in districts that qualified for additional funds. This combination of political engagement and reduced taxation may explain the greater enrollment retention and faster reopening we observe in such districts.
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